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Standard Chartered PLC
Type Public
LSE: STAN
SEHK: 2888
OTCBB: SCBFF
Founded 1853
Headquarters London, United Kingdom
Area served Worldwide
Key people John W. Peace
(Chairman of the Board)
Peter A. Sands
(CEO)
Industry Banking
Products Financial Services
Revenue £12.926 billion (2009)[1]
Operating income £5.151 billion (2009)[1]
Net income £3.279 billion (2009)[1]
Total assets £435.068 billion (2009)
Total equity £23.447 billion (2009)
Employees 73,800 (2008)
Website StandardChartered.com or SC.com

Standard Chartered Bank (LSE: STAN, SEHK: 2888,OTCBB: SCBFF) is a British bank headquartered in London with operations in more than seventy countries. It operates a network of over 1,700 branches and outlets (including subsidiaries, associates and joint ventures) and employs 73,000 people.

Despite its British base, it has few customers in the United Kingdom and 90% of its profits come from Asia, Africa, and the Middle East. Because the bank's history is entwined with the development of the British Empire, its operations lie predominantly in former British colonies, though over the past two decades it has expanded into countries that have historically had little British influence. It aims to provide a safe regulatory bridge between these developing economies.

It now focuses on consumer, corporate, and institutional banking, and on the provision of treasury services—areas in which the Group had particular strength and expertise.

Standard Chartered is listed on the London Stock Exchange and the Hong Kong Stock Exchange and is a constituent of the FTSE 100 Index. Its largest shareholder is Temasek Holdings.[2].

Contents

History

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The early years

The name Standard Chartered comes from the two original banks from which it was founded and which merged in 1969 — The Chartered Bank of India, Australia and China, and The Standard Bank of British South Africa.[3]

The Chartered Bank was founded by Scotsman James Wilson following the grant of a Royal Charter by Queen Victoria in 1853,[3] while The Standard Bank was founded in the Cape Province of South Africa in 1862 by another Scotsman John Paterson.[3] Both companies were keen to capitalise on the huge expansion of trade and to earn the handsome profits to be made from financing the movement of goods from Europe to the East and to Africa.

In those early years, both banks prospered. Standard Chartered Bank has a major branch in Kolkata.[4] Chartered opened its first branches in Bombay, Kolkata and Shanghai in 1858, followed by Hong Kong and Singapore in 1859.[3] With the opening of the Suez Canal in 1869 and the extension of the telegraph to China in 1871, Chartered was well placed to expand and develop its business.[3]

In South Africa, Standard, having established a considerable number of branches, was prominent in financing the development of the diamond fields of Kimberley from 1867 and later extended its network further north to the new town of Johannesburg when gold was discovered there in 1885.[3] Half the output of the second largest gold field in the world passed through The Standard Bank on its way to London.

Both banks – at that time still quite separate companies – survived the First World War and the Depression, but were directly affected by the wider conflict of the Second World War in terms of loss of business and closure of branches. There were also longer term effects for both banks as countries in Asia and Africa gained their independence in the ‘50s and ‘60s.

Each had acquired other small banks along the way and spread their networks further. In 1969, the banks decided to merge,[3] and to counterbalance their existing network by expanding in Europe and the United States, while continuing their expansion in their traditional markets in Asia and Africa.

In 1986 Lloyds Bank of the United Kingdom made a hostile takeover bid for the Group.[5]. The bid was defeated however it spurred Standard Chartered into a period of change, including a series of divestments notably in the United States and South Africa.

Standard Chartered in Gurgaon, India

Recent alliances and developments

In 2000, Standard Chartered acquired Grindlays Bank from ANZ Bank, increasing its presence in private banking and further expanding its operations in India and Pakistan.[6] Standard Chartered retained Grindlays' private banking operations in London and Luxembourg and the subsidiary in Jersey, all of which it integrated into its own private bank. This now serves high net worth customers in Hong Kong, Dubai, and Johannesburg under the name Standard Chartered Grindlays Offshore Financial Services. In India, Standard Chartered integrated most of Grindlays' operations, making Standard Chartered the largest foreign bank in the country.

On 15 April 2005, the bank acquired Korea First Bank, beating HSBC in the bid.[7] Since then the bank has rebranded the branches as SC First Bank.

Standard Chartered completed the integration of its Bangkok branch and Standard Chartered Nakornthon Bank in October, renaming the new entity Standard Chartered Bank (Thailand).[8] Standard Chartered also formed strategic alliances with Fleming Family & Partners to expand private wealth management in Asia and the Middle East, and acquired stakes in ACB Vietnam, Travelex, American Express Bank in Bangladesh and Bohai Bank in China.

A Standard Chartered Bank in Singapore.

On 9 August 2006 Standard Chartered announced that it had acquired an 81% shareholding in the Union Bank of Pakistan in a deal ultimately worth $511 million.[9] This deal represented the first acquisition by a foreign firm of a Pakistani bank and the merged bank, Standard Chartered Bank (Pakistan), is now Pakistan's sixth largest bank.

On 22 October, 2006 Standard Chartered announced that it had received tenders for more than 51 per cent of the issued share capital of Hsinchu International Bank (“Hsinchu”), established in 1948 in Hsinchu province in Taiwan.[10] Standard Chartered, which had first entered Taiwan in 1985, acquired majority ownership of the bank, Taiwan’s seventh largest private sector bank by loans and deposits as at 30 June, 2006. Standard Chartered merged its existing three branches with Hsinchu's 83, and then delisted Hsinchu International Bank, changing the bank's name to Standard Chartered Bank (Taiwan) Limited). Prior to the merger, Hsinchu had suffered extensive losses on defaulted credit card debt.

In 2007, Standard Chartered opened its Private Banking global headquarters in Singapore.[11]

On 23 August, 2007 Standard Chartered entered into an agreement to buy a 49 percent of an Indian brokerage firm (UTI Securities) for $36 million in cash from Securities Trading Corporation of India Ltd., with the option to raise its stake to 75 percent in 2008 and, if both partners agree, to 100 percent by 2010.[12] UTI Securities offers broking, wealth management and investment banking services across 60 Indian cities.

On 29 February 2008, Standard Chartered PLC announced it has received all the required approvals leading to the completion of its acquisition of American Express Bank Ltd (AEB) from the American Express Company (AXP). The total cash consideration for the acquisition is US$823 million.[13]

On 12 September 2009, The Times newspaper in the United Kingdom reported that Standard Chartered had signed a record equaling £20million a season sponsorship deal with Liverpool FC to commence at the start of the 2010/2011 English Premier League season and last for four years[14], in a deal equally the record amount set by Manchester United's sponsorship deal with insurance giant Aon. Liverpool football club announced on the club's official website on 14 September 2009 that Standard Chartered bank will be the new shirt sponsor starting from 2010 to 2014.

On 27 November 2009, Dow Jones Financial News reported the city of Dubai will restructure its largest corporate entity. Amongst international banks, Standard Chartered has one of the largest loan portfolios in the Dubai market and the UAE as a whole, estimated to be $7.77bn in total. This amounts to 4.2% of Standard Chartered's total loans outstanding. Other impacted banks included HSBC, Barclays, and RBS. However, Standard Chartered said that any impairment arising from this exposure would not be material [15].

Senior management

Peter Sands is the chief executive of Standard Chartered Bank. His total annual compensation is $4,142,000. This consists of a $1,516,000 salary and $2,626,000 bonus.[16]

See also

References


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