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Six things to know about jobs and layoffs at Standard Chartered in Singapore and Hong Kong

Do you work for Standard Chartered in Asia? Should you feel concerned or content about your future at the firm? That largely depends on which division you’re in. Stan Chart’s third quarter results, released as the bank looks to keep a lid on costs, point to both buoyant and underperforming job functions in Singapore and Hong Kong, its two main Asian hubs.

Stan Chart’s Q3 numbers for Asia look good on the face of it. Its Asian operating income stood at $7,678m (68% of its global total) in the nine months to end-September – an 8% year-on-year increase. By contrast, revenues from Africa and the Middle East, the bank’s second largest region, fell 5% over the same period.

As we noted last week, however, the danger on the horizon for staff in Singapore and Hong Kong is that the bank is looking to cut its operating expenses in the current quarter (costs were up 5% year on year, according to Stan Chart’s results). Stan Chart needs to hit a $10.2bn cost target for 2018, and this could involve cutting senior jobs in high-cost markets, according to an October 5 management email from CFO Andy Halford. Meanwhile, CEO Bill Winters, speaking to analysts after the results were released, said the firm will get “tougher” on discretionary costs to made sure it meets this target, although he made no specific mention of redundancies.

What, then, can we infer about jobs at Stan Chart in Asia from Winter’s presentation and the bank’s financial report? Here’s what you need to know.

Technology: make sure you’re business facing

Standard Chartered is channelling a “greater proportion” of its investments into “strategic initiatives including digital capabilities”, according to its Q3 report. Winters said he’s confident that these investments will drive earnings growth “in the medium term” and he highlighted the recent launch of a new digital wealth management platform in Singapore, which will soon be rolled out in Hong Kong. Stan Chart therefore appears primed to keep on expanding its tech team.

But while Singapore is a key development centre for the bank, the increased investment doesn’t necessarily mean that all tech jobs in the city state are safe. “I’ve heard that the senior-level job gutting in Singapore will include tech, and that some more tech roles are moving offshore,” says a headhunter in Singapore who works with the bank. “SCB is also moving software development roles from Singapore to India, especially those that aren’t business facing. The jobs that are business facing will always stay in Singapore, and there remain pockets of tech hiring in Q4.” In India, Stan Chart has invested in robotics process automation systems to speed up client onboarding, Winters said during the earnings call. A spokesperson for Stan Chart in Singapore chose not to provide further comment on technology jobs.

Corporate finance is underperforming

While nine-month revenue for the corporate and institutional banking division was up 5% year on year, this was driven by transaction banking (see below). Other parts of CIB fared less well. Stan Chart noted “lower income from corporate finance due to margin compression offsetting improving deal activity”. The performance in financial markets “was flat because of lower client activity in the period”.

Transaction banking: sales roles appear secure; managerial ones less so

Bread-and-butter transaction banking may be the safest place within CIB – at least if you’re in a client-facing role. There was “good growth in transaction banking, driven by a strong performance in cash management, wealth management and retail products”, according to the bank’s report, which also noted “good growth in Singapore notably in transaction banking”. The function is still vulnerable to job cuts at a senior level, however, with non-sales managerial positions under threat in the coming months, says a source close to Stan Chart in Singapore.

Compliance: work in financial crime

Winters highlighted an “almost ten-fold increase in our annual financial crime compliance spending and a more than seven-fold increase in headcount dedicated to this” since 2012. While some of the bank’s financial crime expansion has been driven by the need to cooperate with US authorities on resolving the Iran sanctions probe, recruiters in Singapore say financial crime is a key local focus for the firm, even as overall compliance hiring plateaus at Stan Chart and across the banking sector.

Wealth management: serve mass-affluent clients

Winters singled out “affluent” clients (the emerging rich, who don’t yet qualify for high-net-worth private banking services) as a key segment for Stan Chart which is experiencing double-digit growth. This suggests more relationship manager jobs may soon open up within priority banking in Singapore and Hong Kong, two key centres for affluent clients. As revenue generators, RMs are also unlikely to be the target of job cuts.

Choose Hong Kong over Singapore?

Stan Chart may employ more of its global heads in Singapore, but its North Asia business (which is headquartered in Hong Kong) is larger and growing more rapidly. Greater China and North Asia generated $4,647m (up 11%) in revenues for the first nine months, compared with $3,031m (up 4%) in ASEAN and South Asia. While the rise came from all of the firm’s divisions, there was particular “momentum” in cash management, wealth management and deposits products.

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AUTHORSimon Mortlock Content Manager

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