Standard Chartered set to raise £3.3 billion in rights issue

[LONDON] Standard Chartered Plc said it planned to raise £3.3 billion (S$7.1 billion) in a rights issue as the bank reported an unexpected quarterly loss and said that it would pay no final dividend for this year.

The two-for-seven issue priced at 465 pence per share will boost the lender's common-equity Tier-1 capital ratio to 13.1 per cent from 11.5 per cent, the lender said in a statement on Tuesday. Largest shareholder Temasek Holdings Pte intends to take up rights for 15.8 per cent of existing share capital, the bank said.

The pretax loss of US$139 million for the third quarter compared with a US$1.53 billion profit a year earlier, the London-based bank said in a separate statement. The average of five analyst estimates compiled by Bloomberg was for a US$903 million profit.

"The business environment in our markets remains challenging and our recent performance is disappointing," chief executive officer Bill Winters said.

Mr Winters, 54, is struggling to revive the lender after its value halved over the past two years. The bank's plans to raise capital come with British regulators set to publish stress tests next month.

Its stock has declined 26 per cent in London this year.

BLOOMBERG