30th Apr 2019 05:37
LONDON (Alliance News) - Asia-focused financial group Standard Chartered PLC launched a USD1 billion share buyback programme Tuesday after first quarter profit and return on equity improved as it focused on expanding customers numbers and services and legacy issues subsided.
For the three months ended March, pretax profit rose 4.2% to USD1.24 billion from USD1.19 billion the year prior. This was despite operating income dipping 1.6% to USD3.81 billion from USD3.87 billion the year before.
On a underlying basis, pretax profit widened 9.5% to USD1.38 billion from USD1.26 billion the year prior.
"The first quarter demonstrated our determination to deliver the refreshed strategic priorities at pace," Standard Chartered Chief Executive Officer Bill Winters said. "We announced a number of digital initiatives across Hong Kong, Africa and India aimed at growing our customer base and enhancing our services."
"Our first quarter profit supports our belief that we will generate full-year returns of at least 10% by 2021," Winters added.
Return on equity expanded to 7.1% from 6.8% the year prior, with underlying return on tangible equity expanded to 9.6% from 8.6% the year before. Common equity tier one ratio held firm at 13.9% on the year before.
"The resolution of our legacy conduct and control issues means we can now manage our capital position more dynamically," Winters continued. "We will maintain our strategic investment programme and start to buy back USD1 billion of our shares, reflecting our confidence in our ability to execute the strategy and create long-term shareholder value."
Standard Chartered made the move to buy back up to USD1.00 billion worth of shares after the resolution of its legacy issues. the buy back will start "imminently" and is expected to reduce the CET1 ratio in the second quarter by around 35 basis points.
Shares in Standard Chartered closed at 669.40 pence on Monday, giving it a market capitalisation of GBP22.12 billion or USD28.62 billion.
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