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Big cuts at Standard Chartered

Big cuts at Standard Chartered
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Asia-focused bank Standard Chartered is to shut its loss-making stocks and shares, or equities, investment division, which will shrink the workforce by around 200.

An additional 4,000 jobs will go in its branches worldwide this year. That is about five percent of the bank’s 86,000 employees.

It is all part of a cost-cutting plan announced last October for $400 million (340 million euros) of savings this year.

Standard Chartered is trying to bounce back after seeing its share price slump more than 40 percent over the past two years.

Retail banking, where it has more than 10 million customers in 34 countries, is a major target in its cost-cutting plan.

The lender plans to focus more on just its 1.6 million priority retail customers and 400,000 business clients.

“Management is continuing with their rationalisation process and no unprofitable sacred cows have been left untouched,” said Christopher Wong, a senior investment manager at Aberdeen Asset Management Asia.

Bankers in Standard Chartered’s equities division in Hong Kong arrived on Thursday to find they were locked out of the office, while some in Singapore were escorted from their workplaces.

The decision to exit equities marks a reversal in strategy for the bank, which had been hiring staff in the division as recently as October last year.

Some analysts said more action may be needed to get the bank back on track, however.

“It’s a logical step. But laying off staff is not enough to address the situation,” said James Antos, a banking analyst at Mizuho Securities Asia in Hong Kong.

London-based Standard Chartered issued three profit warnings last year and two months ago rating agency Standard & Poor’s hit it with its first ever downgrade.