StanChart to inject over $3b capital into Singapore unit

Standard Chartered Bank (StanChart) will inject more than US$2.5 billion (S$3.38 billion) in common equity tier 1 (CET1) capital into its locally incorporated unit as part of a business transfer.

The new capital, together with the bank's transition to advanced modelling for risk-weighted assets, will increase the bank's capital position by about three times, it said yesterday.

After the exercise is complete, the local unit - Standard Chartered Bank (Singapore), which already operates the retail banking business - will operate the commercial banking, corporate and institutional banking, and private banking businesses.

The exercise is expected to be completed by May 13, subject to legal and regulatory approvals.

By operating as a single entity, the group aims to increase efficiency, as well as reduce operational and process complexity. A unified balance sheet will also enable more scale and flexibility to optimise funding decisions.

"The consolidated entity will be a well-capitalised Singapore-regulated bank with strong liquidity," the lender said.

When the move was announced in February last year, StanChart said it would not affect service to clients and that it would minimise impact on accounts and dealings.

The consolidation follows StanChart Singapore's incorporation as a subsidiary here in 2013; when the lender transferred its retail and business banking, as well as part of its commercial banking business, to the Singapore unit.

A version of this article appeared in the print edition of The Straits Times on March 21, 2019, with the headline 'StanChart to inject over $3b capital into S'pore unit'. Print Edition | Subscribe