StanChart sees UK bank tax rising again amid HQ review

Wed May 6, 2015 10:15am EDT
 
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By Steve Slater

LONDON (Reuters) - Standard Chartered (STAN.L: Quote) said it expected Britain to increase its bank levy again and the rising cost of the tax was a key issue in its assessment of whether to keep its headquarters in London or move to Asia.

Standard Chartered Chairman John Peace told investors on Wednesday the Asia-focused bank had "no current plans to move" but was keeping its domicile under review. Rival HSBC (HSBA.L: Quote) is formally reviewing the best place for its HQ and will decide whether to move in the next few months.

"We are listening carefully to our shareholders on this issue ... in light of the latest increase in the bank levy, the likelihood of further increases and the impact on the group's costs," Peace said at the annual shareholder meeting.

Analysts said a move could make more sense for Standard Chartered than HSBC, but the bank had other operating problems that would be a higher priority for its new chief executive.

Former JPMorgan (JPM.N: Quote) investment bank boss Bill Winters is taking over as CEO from Peter Sands on June 10. Winters started working at the bank last week, and has been meeting shareholders and visiting operations.

Standard Chartered is trying to turn around its performance after a torrid two years and a purge of leadership. The bank is trying to cut costs and shrink its loan book to improve its profitability and deal with concerns about its capital.

The bank's shares are up 13 percent since Winters was appointed in February. One shareholder at the meeting said Winters was "the bearer of hope" for the bank.

Former McKinsey consultant Sands told investors he was proud of his 13 years at the bank, including more than eight as CEO. "Along the way we've had many ups and downs, we've had great successes and made our share of mistakes," he said.   Continued...

 
A man walks past the head office of Standard Chartered bank in the City of London February 27, 2015. REUTERS/Eddie Keogh/Files