Sands gets grip on higher costs
WHEN Peter Sands unveiled Standard Charter’s full-year results in March, he said the bank was engaged in a “war for talent”. The demand for top flight bankers who can speak Cantonese or Mandarin is higher than ever, and StanChart is having to fight both HSBC and local rivals to sign the best staff.
As the son of a naval officer, Sands will know that fighting a war is not cheap. The only dark spot in an otherwise glittering set of annual results was costs, which surged by 13 per cent in 2010 compared income growth of 5.8 per cent.
The most encouraging thing about yesterday’s statement was that costs have grown broadly in line with income, meaning the bank is operating with a cost-to-income ratio of around 56 per cent.
That should remove nagging doubts that Standard Chartered’s growth is down to a spend, spend, spend strategy. It trades at a premium to all the other UK banks, but this is more than deserved.