StanChart announces US$1 billion share buyback, dividend hike as 2023 profit rises 18%

STANDARD Chartered on Friday (Feb 23) reported 2023 pre-tax revenue rose 18 per cent, according to forecasts, and rewarded shareholders with a US$1 billion share buyback and a leap in dividend.

StanChart, which earns most of its income in Asia, stated statutory pretax revenue for 2023 reached US$5.09 billion, according to US$5.1 billion from 15 analyst estimates compiled by the financial institution.

The financial institution took a US$850 million impairment primarily from its stake in Chinese lender Bohai Bank, its second time writing down the worth of the unit because the lender was hit by growing dangerous loans as development on this planet’s second-largest financial system sputtered.

The hefty loss in China, a core goal for StanChart’s technique, underlines the problem it faces to develop within the nation as policymakers wrestle to arrest a deepening property disaster and weak client confidence.

A contemporary US$150 million writedown of its stake in Bohai Bank, following a US$700 million hit earlier this 12 months, lowered its worth to US$700 million from US$1.5 billion firstly of the 12 months.

StanChart stated banking business challenges and the uncertainty swirling across the property market have been in charge for the decline within the stake’s present worth.

The London-headquartered lender additionally introduced a ultimate dividend of US$560 million or 21 US cents per share, leading to a 50 per cent enhance of full 12 months dividend payout to 27 US cents, higher than a consensus view of 23.7 US cents.

CEO Bill Winters stated in a launch that the financial institution targets to return a minimum of US$5 billion over the subsequent three years.

The financial institution set out restrained new steerage on its future efficiency, saying it anticipated earnings to develop 5-7 per cent between 2024 and 2026, as in opposition to 10 per cent development in 2023.

The lender stated it will intention to extend return on tangible fairness, a key profitability metric, ‘steadily’ from the present stage of 10 per cent to 12 per cent by 2026.

“The ‘last mile’ of inflation may prove stickier than expected, and geopolitical risks abound,” Group chairman José Vinals stated within the launch.

“As we begin 2024, the war between Ukraine and Russia continues, increasing uncertainty for nations in Europe and elsewhere.” REUTERS