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Standard Chartered will cut chief executive Bill Winters’ salary by 40 per cent and award him a higher potential bonus, in an overhaul that could raise his total pay package to as much as £13.1mn for this year.
The bank is overhauling executive pay after the UK removed a cap on bankers’ bonuses. Under its new plan, Winters this year would make more than twice what he earned in 2022 if he were to meet all targets, taking his performance-linked pay to as much as 85 per cent of the total.
StanChart said it “represents the most significant change for many years” in the way top staff are paid.
The bank said abolition of the cap allowed it to “rebalance” total pay from fixed salaries towards performance-linked pay. Winters’ pay package had already risen nearly 50 per cent for 2024, taking it to £10.7mn, because of payouts from an incentive plan. The £13.1mn figure would be a 23 per cent rise from that.
Chief financial officer Diego De Giorgi’s salary will be cut 33 per cent under the new model, with his total package worth up to £7.7mn if targets are met. He made £2.8mn in 2024.
The bank announced the overhaul alongside annual results on Friday.
Its pre-tax profits fell 30 per cent in the final three months of last year amid rising costs, even as its wealth and markets businesses generated higher revenues.
The bank reported statutory pre-tax profits of $800mn for the fourth quarter, down from $1.1bn a year earlier and missing analysts’ estimates of $983mn. Its underlying pre-tax profits, adjusted to take restructuring and other costs into account, were $1bn, in line with analysts’ estimates.
Winters said results for the full year, in which reported pre-tax profits rose 19 per cent to $6bn, were “strong”.
“Our strategy . . . is firing on all cylinders,” said Winters, who has run the bank since 2015. StanChart said in October it would double investment in its wealth management business and shift its focus away from smaller domestic clients towards global institutions.
The bank announced a $1.5bn share buyback and said it planned to return at least $8bn to shareholders cumulatively from 2024 to 2026.
Net interest income for the year was $10.4bn, beating the bank’s target of $10.25bn, even as a period of rising rates has come to an end.
StanChart took restructuring charges of $441mn for the year, including $156mn for its cost-saving programme, known as “Fit for Growth”. The bank said last year it planned to save about $1.5bn over a three-year period by simplifying systems.
Its wealth business, a key focus for the bank, reported a 36 per cent rise in revenues for the quarter, while those in its markets unit rose 47 per cent as income from trading jumped.
The bank’s underlying return on tangible equity, a measure of profitability, was 11.7 per cent for the year, up from 10.1 per cent a year earlier. It raised its 2026 target from 12 per cent to “approaching 13 per cent”.
StanChart shares have now surpassed the level they were at when Winters took the helm, having risen more than 80 per cent since he lamented their “crap” price a year ago.
However, the stock still trades at a discount to the bank assets’ book value. Its Hong Kong-listed shares rose 1 per cent on Friday before paring gains to be down 0.4 per cent.
This month, it named Maria Ramos, a current StanChart board member and former chief executive of South African bank Absa, as its next chair.
In 2019, Winters attacked “immature” investors who staged a protest about his pay.
https://www.ft.com/content/bf316cf0-cab3-47bc-a2f1-a4f52c751bfe
