Standard Chartered names IMF executive as its next chairman

BRITISH-based bank Standard Chartered is to appoint senior International Monetary Fund executive José Viñals as its next chairman after a 17-month search to find a candidate for the top job.

Mr Viñals will replace Sir John Peace, who has held the position since 2009, in December. He will receive an annual fee of £1.25m.

His naming completes a series of major changes at the bank, which included the appointment of chief executive Bill Winters last year. Mr Viñals currently oversees the IMF’s monetary and financial sector work. Previously he spent seven years in senior roles at the Financial Stability Board, which is responsible for much of the global regulation of banks.

Naguib Kheraj, the director who conducted the search for a new chairman, said it took so much time because it is hard to find suitable candidates who want the job.

“The obligations of bank chairmen are quite significant today, much greater than they were pre-financial crisis,” said Mr Kheraj, who will be promoted to deputy chairman.

“Obviously that is an issue [for candidates] – it is not that they don’t want to do it, but it is about the ability to commit the time.”

That marks a contrast with Sir John’s career – he is currently also chairman of Burberry and for a time headed Experian’s board, giving him three of the top jobs in the City simultaneously.

Standard Chartered is UK based but operates mainly in emerging markets. It has struggled recently, in 2015 recording its first annual loss since 1989.

The share price fell from more than £15 in 2013 to a low of just above £4 earlier this year. It has since picked up to £6.30, up 6½p yesterday.

Challenges for the new boss include restructuring the bank, cutting costs, ending the wave of regulatory investigations, and coping with a slowdown in key markets such as China.

Other major global banks are also labouring under tough conditions.

Deutsche Bank’s net profit fell to €20m (£16.7m) in the second quarter of the year, a drop of 98pc on the same period of 2015. Revenues dived in almost every division and while costs have fallen by 14pc, thanks to lower legal bills and chief executive John Cryan’s efforts to slash the bank’s workforce, it is not yet enough to offset plunging income.

The picture in the UK is less severe for Deutsche Bank, despite worries from economists that the vote to leave the EU will dent growth.

Meanwhile Santander UK yesterday reported a 16pc rise in pre-tax profits to £1.1bn in the first half of the year. It does expect the economy to slow, but believes there has not yet been a clear negative impact on its business.

The challenger banks Shawbrook Bank and Metro Bank both also reported strong rises in revenues yesterday, slashing Metro’s losses in half as it moves closer to turning a profit, and boosting Shawbrook’s profits 42.5pc.

“Since the referendum vote we have seen no change in customer behaviour or impact on business flows,” said Metro’s chief executive, Craig Donaldson.

Shawbrook’s chief, Steve Pateman, said: “The guy on the street who voted to leave didn’t think it was a bad idea and has not changed spending activities.”

‘The obligations of bank chairmen are quite significant, much greater than pre-financial crisis’