Aberdeen CEO Would Support Standard Chartered Capital Boost

  • Bank's No. 2 investor says Winters hasn't sounded out Aberdeen
  • Aberdeen Backs $9.9 Million Joining Fee for CEO Bill Winters

Standard Chartered Plc’s second-largest shareholder, Aberdeen Asset Management Plc, would support a capital increase if the bank decides it needs to shore up its balance sheet, Chief Executive Officer Martin Gilbert said.

“I think what Bill Winters will probably do is thoroughly review the business and then decide,” Gilbert, referring to the bank’s chief executive officer, said in an interview in London. “I suspect it’s on a knife edge. If he needs to raise capital, we will be supportive of it,” though Aberdeen hasn’t been sounded out for its view, Gilbert said.

Winters, 53, last month cut the bank’s dividend in half to save $1 billion and help reverse a two-year slump in earnings, which has been exacerbated as turmoil in Asia and falling commodity prices push up loan losses. He’s also eliminating as many as 250 of about 1,000 managing directors worldwide.

With British lenders facing a second round of harsher stress tests later this year, some analysts have forecast Standard Chartered may need to raise as much as $10 billion of capital, a sum equivalent to more than a third of its current market capitalization.

Simon Kutner, a London-based spokesman for the bank, declined to comment.

Standard Chartered is at its lowest price since March 2009 and slid 2.4 percent to 651.8 pence at 3:05 p.m. in London, pushing the decline this year to 32 percent. The company has a market value of 16.6 billion pounds ($25.3 billion). Winters, a former co-head of JPMorgan Chase & Co.’s investment bank, took over as CEO from Peter Sands in June, sparking a brief rally in the shares after they slid 29 percent in 2014.

Aberdeen plans to maintain its roughly 9 percent stake, Gilbert said. Singapore’s Temasek Holdings Pte is Standard Chartered’s largest shareholder, with about 17 percent, according to data compiled by Bloomberg.

“The board have done a great job in getting Bill because I think he’s one of the best bankers around,” Gilbert said. “Already we’ve seen an improvement in morale at the bank. But he’s got a long journey -- it’s a big job and it’ll take time.”

Standard Chartered on Wednesday granted Winters 6.5 million pounds of stock to compensate him for leaving Renshaw Bay, the investment firm he’d been running. He will receive about 400,000 pounds in additional shares as a fixed pay allowance, which are released over a five-year period.

“On his package, I don’t mind the buyout because if you want to get someone as talented as him, you’re going to have to pay,” Gilbert said. “We support it.”

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