LONDON (AP) — Banking group Standard Chartered is slashing 15,000 jobs worldwide and plans to raise $5.1 billion from shareholders through a rights issue as part of a major restructuring to shore up its financial position.
The Asia-focused bank also announced plans Tuesday to shift operations away from institutional and corporate banking toward private banking and wealth management. It said it would invest to grow its business in Africa and would improve its digital capability to make the bank more efficient.
"We will execute as quickly as possible to get through this transition phase, start delivering improved performance, and ensure our people are focused on providing value to our clients across Asia, Africa and the Middle East."
Standard Chartered said the rights issue would help strengthen its balance sheet and improve its capital buffers. It would also help absorb the financial impact of the planned restructuring charges.
The new strategy was revealed as the bank reported a third-quarter pretax loss of $139 million, compared to a profit of $1.5 billion profit in the same period a year earlier.
The bank's decision to focus on "affluent retail clients," may be too late in coming, said Michael Hewson, chief market analyst at CMC Markets UK.
"This appears to have become a recurring theme for a lot of banks in recent years in the pursuit of the more lucrative wealth management area. Unfortunately for Standard Chartered they are way behind the curve on this," Hewson said. "Standard Chartered has belatedly realized that its old business model was broken, and now faces a struggle to catch up."
Standard Chartered said the job losses will be made by 2018, though some senior managers are already being cut. Some $100 billion in assets will be restructured or "exited."
Winters took over from Peter Sands this year.