Standard Chartered Fires 1000, Positive Move say Analysts

Standard Chartered's move to fire 1,000 managers is a positive in the short term, say analysts – the cuts will save about 2% of 2014’s compensation costs

Erin Davis 12 October, 2015 | 8:06AM
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Standard Chartered’s (STAN) new CEO Bill Winters firmly put his stamp on the bank this week when he sent a memo to staff indicating that he plans to dismiss 25% of the bank’s top 1,000 managers.

This year will focus on risks from emerging markets

We think the move is clearly a positive in the short term – assuming average compensation per manager of $500,000, the cuts will save about 2% of 2014’s compensation costs – but could increase risk in the long term, as institutional knowledge is lost.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Standard Chartered PLC414.20 GBP0.00Rating

About Author

Erin Davis  is a senior banking analyst for Morningstar.