Standard Chartered said it will slash costs by 700 million US dollars (£532 million) under a three-year overhaul as it posted a lower-than-expected annual profits haul.
The Asia-focused bank reported underlying full-year pre-tax profits of 3.86 billion US dollars (£2.9 billion) – a 28% increase on 2017, but this missed City forecasts, while bottom-line profits were also hit by charges relating to investigations in the UK and the US.
Standard Chartered booked a 5.5% rise statutory pre-tax profits to 2.55 billion US dollars (£1.9 billion), with growth held back by a 900 million US dollar (£684 million) charge revealed last week to cover fines, largely relating to US investigations into alleged violations of sanctions.
The results came as Standard Chartered also unveiled a new strategy to boost growth, including slashing costs and exiting smaller businesses.
It is looking to quit markets with low returns, such as India, Korea, the United Arab Emirates and Indonesia.
Bill Winters, group chief executive of Standard Chartered, said the bank will deliver improvements “through relentlessly focusing on where we have a distinct competitive advantage, attacking the residual causes of lower returns and ramping up innovation and productivity”.
He added: “We view the profound technology-driven changes in banking as an opportunity: we are big enough to be relevant to our most complex clients and partners, yet nimble enough to be a profitable disrupter.”
Shares in the FTSE 100-listed group fell 3%.
The stock has tumbled in recent years, falling 22% in 2018.
Its strategy re-think comes with the group’s markets under pressure amid worries over a slowdown caused by mounting US and China trade tensions.
But Gary Greenwood, a banking analyst at Shore Capital, said: “Despite near-term economic uncertainties associated with the US/China trade wars and the withdrawal of quantitative easing, we believe that Standard Chartered’s exposure to relatively fast-growing emerging markets (Asia and Africa) provides a supportive backdrop to its recovery prospects, which we expect to drive an improvement in returns.”