The announcement of his departure comes a month after the bank revealed chief executive Peter Sands and chairman Sir John Peace were also on their way out.
Shankar was also chief executive for Europe, the Middle East, Africa and the Americas, at the emerging markets giant.
Shankar will not be replaced directly on the board, as StanChart is slimming the top level group.
“On behalf of the board, I would like to thank Shankar for the service he has given to Standard Chartered over the last 13 years,” said Peace.
Shankar told Bloomberg News he plans to set up an emerging markets private equity business.
The bank said it is appointing Jonathan Paul as head of financial markets and promoting Sumit Dayal to head of corporate finance.