Sir John Peace, chairman of Standard Chartered, has said the embattled bank can turn round its performance without a radical overhaul – although he conceded that it needs to show more humility.
Under pressure from investors after three profit warnings have pushed the share price down by nearly a third this year, Peace said the bank was “in a transition” and he felt “positive, cautious and frustrated”.
His remarks, made to 300 of the bank’s senior managers in Singapore this week, emerged as the bank’s management team were preparing to deliver three days of presentations to investors to convince them there is a coherent plan to bolster returns.
The board was forced to issue a statement during the week backing Peace and the chief executive, Peter Sands, who is one of the few bank bosses to have retained their job through the financial crisis.
“We’re making changes,” Peace said. “But all you have to do is go out in the field, go out into our markets, and you very quickly realise that it’s not broken. It just needs to go in for its 10-year service and we are in there for that 10-year service now.”
Peace, who is also chairman of fashion retailer Burberry, said in unscripted remarks that “it’s a question of going through this difficult period, gritting our teeth”.
He said: “Humility is a very important word. It’s very important that we recognise we make mistakes”.
Sands and Peace were already under pressure even before last week’s profits warning which was closely followed by confirmation that the US authorities had reopened an investigation into the bank after its £415m fine in 2012 for breaching US sanctions with Iran.
Peace’s remarks were reported by the Wall Street Journal. He warned the managers that the bank was “in for a tough few weeks still”.
Describing his emotions, Peace said: “I feel positive, cautious and frustrated. All of those emotions, that’s what emotional connectivity means, but more than anything I feel determined to win, and I think the folks in this room are pretty much like me and Peter. Let’s win together.”
Sands will try to convince investors assembling in Hong Kong for three days this coming week – starting on Tuesday – that he can see through his plan to “refresh” the bank.
He has promised to outline how he intends to cut $400m (£250m) from costs and will face questions about whether the bank has enough capital. He has insisted that it does.
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