Gloom at StanChart S’pore as bank announced 15,000 job cuts globally

Gloom at StanChart S’pore as bank announced 15,000 job cuts globally

TODAY reports: Several StanChart employees said they were not so much shocked - as the job cuts have been in the offing for a while now - but they remained in an immense state of stress.

By Rumi Hardasmalani, TODAY
POSTED: 04 Nov 2015 09:39

SINGAPORE: The mood is sombre at Standard Chartered’s Singapore offices after the Asia-focused British lender announced on Tuesday (Nov 3) plans to cut 15,000 jobs from its 86,000 global workforce by 2018, while seeking to raise more than US$5 billion (S$7 billion) in new capital.

StanChart Singapore, which employs about 7,000 people and ­appointed Canadian Judy Hsu as its new CEO as recently as September, declined to comment on the number of jobs that will be cut here.

However, it did say that the bank has substantially completed 1,000 senior staff ­exits globally, while other positions will be whittled down through attrition.

Several of the bank’s employees, who TODAY spoke to on condition of anonymity, reflected the uncertainty that looms large over their ­future.

They said they were not so much shocked - as the job cuts have been in the offing for a while now - but they remained in an immense state of stress.

“We are indeed distracted and confused about what we should do next. We are certainly not in a position to negotiate better salaries with other potential employers. The uncertainty is quite scary. We are neither in a position to pick up nor refuse the not-so-attractive job offers in our hands,” said a senior-level StanChart Singapore staffer.

Another senior-level bank employee also noted the gloomy sentiment, but added: “The positive thing is that we are getting regular strategy updates from the CEO’s office these days.”

The senior-level and front-office employees are at a higher risk of being retrenched, with surplus talent in these segments of the market, recruiters told TODAY.

However, those in business-critical roles such as revenue-generation as well as risk-related, compliance and internal audit positions are relatively safe and are not likely to face the axe, they said.

“Even companies that are cutting costs would prioritise hires for these job functions,” said Ms Lynne Roeder, managing director of leading headhunter Hays Singapore.

Besides the global job cuts, London-based StanChart is also raising US$5.1 billion through a two-for-seven rights issue.

The rights shares will be priced at £4.65 (S$10.02) each, or a 35 per cent discount from the last traded price in London.

Singapore investment company Temasek Holdings, StanChart’s largest shareholder with a 15.8 per cent stake, will take up its full allocation.

“We are confirming our participation in the rights issue in proportion to our current holding in the bank,” Mr Stephen Forshaw, managing director Strategic & Public Affairs at Temasek, said in an email response.

According to StanChart, the capital raising is aimed at financing a planned US$3 billion investment over three years into strategic opportunities, technology and upgrading regulatory and compliance systems, besides strengthening balance sheets.

The latest revamp comes as StanChart reported a third-quarter operating loss of US$139 million, swinging from a US$1.5 billion profit in the previous corresponding period, owing to growing regulatory costs and rising loan impairments in India.

The bank said on Monday it targeted savings of US$2.9 billion by 2018 and will restructure or exit US$100 billion of risk-weighted assets after its expansion strategy in emerging markets such as India had backfired, leaving the bank saddled with huge debts.

China’s growth slowdown and sagging global commodity prices had also weighed on the bank’s performance.

StanChart CEO Bill Winters, who took the helm in June, said on Teusday: “The business environment in our markets remains challenging and our recent performance is disappointing. We will execute as quickly as possible to get through this transition phase. These actions will result in a lean, focused and well-capitalised bank, poised for growth.”

After the restructuring and earnings news, StanChart shares plunged 8.9 per cent to 649.80 pence at noon today in London.


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