The Telegraph
Friday , January 10 , 2014
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Top-level rejig at StanChart


Mumbai, Jan. 9: Standard Chartered Plc today announced a major organisation overhaul that involves the integration of its wholesale and consumer banking arms from April 1 next year.

Mike Rees (57), who has been the CEO of the wholesale banking business since 2002, will head the combined business and be appointed as deputy group chief executive reporting to Peter Sands, the group CEO.

The move has also precipitated the exit of two top executives.

Steve Bertamini, group executive director and CEO of the consumer banking division, will step down from the board at the end of March 2014 and will leave the group by June 30.

Richard Meddings, the group executive director and group finance director, will also step down from the board at the end of June next year.

Sands said, “Today, we are announcing a new model for the organisation of our business. This will sharpen our focus on distinct customer segments. Further, changes will take place in the support and control functions as they adapt to the reshaping of the business and regions.”

The overhaul is in line with the strategy that Stanchart had outlined to investors last November.

Sands said the changes had not been made in response to pressure from Temasek, the Singaporean sovereign wealth fund that owns 18 per cent in the bank.

Last May, Temasek had insisted that Stanchart should appoint more non-executive directors to its board and cut the number of managers serving as directors.

At that time, Temasek had refused to back the re-election of four executive directors, including Bertamini, Rees, Vishwanathan Shankar and Jaspal Bindra at the annual general meeting. All four were elected but with a sharply reduced majority as a fifth of the shareholders had failed to back them.

“I would like to thank both Steve and Richard for their contribution to the success of the group. Steven and Richard are both outstanding leaders, good friends and will be missed. We wish them both well in their future careers,” Sands added.

The group plans to sharpen its strategy to focus on Asia, Africa and the West Asia. At that time, the Stanchart Group had outlined five aspirations to grow the business. These covered client relationships, trade, wealth, investment and building scale in priority markets.

The reorganisation will support these aspirations, the group said, by helping it to deploy resources more effectively across the whole organisation, serving clients and customers better by grouping them more logically based on their needs, enabling cost savings by removing the duplications between the two business arms, and enhancing collaboration across the group.

The CEO positions in consumer banking and wholesale banking will cease to exist under the new structure, the bank said.

Bertamini will work closely with Sands and Rees to facilitate the transition to the new structure.

The group also implemented a simplified structure of eight geographic regions to enable greater efficiency. Greater China, Asean, Northeast Asia and South Asia will continue to report to Jaspal Bindra, group executive director and CEO Asia.

Middle East, North Africa and Pakistan (MENAP), Africa, Europe and the Americas will continue to report to V. Shankar, group execeutive director and CEO of MENAP, Africa, Europe and the Americas.

Both Jaspal and Shankar will continue to report to Peter Sands.

“After 11 years seven as finance director and as the group now evolves into its next phase, this is a natural point for me to step away,” said Richard Meddings.

The Stanchart group will announce its full-year results for 2013 on March 5 with financial data based on the current group structure. Prior to the half-yearly results in August next year, the group will restate its 2013 financials, according to today’s reorganisation.

The group said Mike Rees’ annual base salary would increase from 735,000 to 975,000. The remuneration committee will review how Rees and other directors’ variable remuneration is delivered going forward. As part of the role change, Rees’ maximum earnings potential under the group’s remuneration policy will reduce by 40 per cent, Stanchart said.