Standard Chartered appeared to blow a raspberry at its critics in the media and the investment community today, claiming “no succession planning is taking place” in the wake of reports that investors are becoming increasingly restive over the status of Peter Sands.
In what one analyst likened to a chairman giving a football manager his “full support” after a poor run of form, usually just days before a sacking, the embattled bank's board issued a statement expressing its “full support” for its long- standing chief executive.
The unusual statement, in which the board also said that it backed the chairman Sir John Peace, attacked what it called “media rumours” and denied any succession planning “as a result of recent investor pressure”.
The statement said: “The board wants to be absolutely clear that it is united in its support of both Peter Sands and Sir John Peace, and the management team, in delivering the refreshed strategy, restoring the bank to profitable growth and delivering returns for our shareholders.”
Standard Chartered, whose business is focused on emerging markets, defied gravity throughout the financial crisis. The London-listed bank needed no bailout and sailed through the storm, increasing its profits and dividends.
But more recently things have gone awry. In addition to last month's surprise profit warning, the second alert over its financial performance in six months, Lenny Feder, the head of the struggling financial markets business, went on a year's sabbatical.
The well-liked finance director Richard Meddings was a surprise departure at the beginning of the year as the bank announced a reorganisation, while there was a revolt over boardroom pay at this year's annual meeting. In 2012 the bank was also hit with a heavy fine for breaching US sanctions against Iran.
While taking shots at the media and critics is not unusual from a company under pressure, doing so in an unscheduled statement to the Stock Exchange is extremely rare and comes amid a rash of reports that shareholders want the bank to start searching for Mr Sands' replacement.
Gary Greenwood, banking analyst at the broker Shore Capital, who rates the shares a “buy”, said: “What is clear to us is that operational performance needs to improve quickly if senior management are to remain in place.”Reuse content