Standard Chartered Private Equity Team Expands Globally

Standard Chartered has formed a new specialist team in private equity firms, hedge funds, and sovereign wealth funds. The move is a strategic build-out of its investment banking franchise.

The new Standard Chartered private equity team will be within the bank's financial institution coverage group and will have around 25 bankers to start with. The team, led from New York, will also maintain offices in London and Dubai.

Leadership and Organization of the New Unit

In the interim, until the permanent global head of financial sponsors assumes the role, Molly Duffy, co-head of financial institution coverage, will lead the group. She shares responsibility for running the division with Jerry Zhang. The coming of the permanent head is around the corner, but the interim leadership is symptomatic of the team's importance to the bank's broader business goals.

A Strategic Reorientation Amidst International Banking Stress

Standard Chartered's new initiative is a major attempt at growth in business with financial sponsors. Already, these customers account for 51% of the bank's total investment banking fee income. With a greater return than the average, they are a high-growth opportunity. Standard Chartered private equity team will spearhead the growth, targeting companies that will deliver long-term value.

Simultaneously, its rival HSBC has been downsizing its U.S. and European M&A and capital markets businesses. StanChart is defying the trend by investing more in the West and maintaining its high profile in Asia, Africa, and the Middle East.

Focus on High-Return Institutional Clients

As Sunil Kaushal, the co-head of StanChart's corporate and investment banking, puts it, the bank is doubling up on asset managers, insurers, banks, and private equity clients. The Standard Chartered private equity team will form the center of the strategy so that the bank can participate in big cross-border deals and have more substantial relationships with high-value financial sponsors.

Investor Strategy Presentation Points to New Direction

The announcement is made in conjunction with a presentation to investors within the framework of a broader drive for transparency. The presentation gave a glimpse into what StanChart will do to shift its investment banking business into higher-margin return and stable growth areas.