Barclays and Standard Chartered shares dive in double blow for UK banking sector
Standard Chartered hit by new profit decline, Barclays facing allegations of “fraud and deceit”
Britain's banking sector received a double blow today as Standard Chartered said it expected first-half profits to be 20 per cent down on a year ago as shares in Barclays crashed on new allegations it had misled investors.
Standard Chartered’s under-fire chief executive Peter Sands said: “This has been a disappointing first half, with difficult trading conditions, particularly in financial markets.”
The bank also said the head of its financial markets business Lenny Feder will take a year’s sabbatical “for personal family reasons”.
He is the third top executive to leave in recent months. Significantly, if he returns he will not come back in the same role and Standard Chartered has launched the hunt for a full-time replacement.
Full-year earnings will also be less than Standard Chartered made last year.
Sands said: “As we navigate this difficult period, we remain focused on the drivers of value creation for our shareholders, continuing to build our franchise to make the most of the enormous opportunities in our markets.”
Standard Chartered shares plunged more than 6 per cent, 82.5p to 1175p. That is their lowest point for almost three years and will add to pressure from major investors, notably the Singapore sovereign wealth fund Temasek, which owns 18 per cent and has not backed the reappointment of bank directors in the past.
The bank is struggling in South Korea, India and Singapore, although it says China and Africa are doing well. It said just under two weeks ago it was selling two smaller businesses in South Korea to Japan’s J Trust as it seeks to cut losses and narrow operations.
Provisions against bad loans are also on the rise, with the bank warning these would be up in the “high teens”. Sands insisted the bank could get past its troubles. Shares in Barclays tumbled 5 per cent, or 12p, to 218p after it emerged it is being sued by New York’s attorney general over allegations of “fraud and deceit” in the dark pool trading system it ran for United States shares.
Eric Schneiderman claimed Barclays had grown its dark pool, LX, into one of the biggest off-exchange businesses on Wall Street “by telling investors they were diving into safe waters… Barclays’ dark pool was full of predators, there at Barclays’ invitation”.
Senator Carl Levin, who leads the Senate investigations committee, claimed the bank had put the interests of high-frequency traders ahead of investors’.
A Barclays spokesman said: “We take these allegations very seriously. Barclays has been cooperating with the New York attorney general and the SEC.”
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
Sony hack: Angelina Jolie branded 'seriously out of her mind' in further embarrassing leaked email saga
Panic Saturday: 13 million Britons spend £1.2bn – while 13 million others across the country live in poverty unable to afford food
iJobs Money & Business
$200 - $350 per annum: Carlton Senior Appointments: Managing Producer Office...
$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...
Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...