Share Buy Back Plan Sends StanChart Stocks Surging

Standard Chartered shares surged 6 percent in Hong Kong on Tuesday after the lender announced a share buyback of up to US$1 billion as it reported a jump in first quarter pre-tax profits.

The lender's first buyback in nearly two decades comes a fortnight after it reached a US$1.1 billion settlement for processing transactions that violated US sanctions on Iran and flouted anti-money laundering requirements.

The London-based StanChart's first quarter pre-tax profits rose 10 percent to US$1.38 billion, it said, sending shares surging six percent in Hong Kong, to closed at HK$71.

"Our first-quarter profit supports our belief that we will generate full-year returns of at least 10 percent by 2021," chief executive Bill Winters said in a statement.

Winters said the company will aim at growing its customer base across Hong Kong, Africa and India.

"The resolution of our legacy conduct and control issues means we can now manage our capital position more dynamically," he added.

The bank said the buyback programme will start "imminently".

Its last buyback was in 2002 when it acquired preference shares it had issued, according to Bloomberg News.

Standard Chartered has implemented wide-ranging restructuring and cutbacks since 2015.

The bank swung back to profit in 2016, a year after scoring its first annual loss for more than a quarter of a century as it struggled to cope with bad debts and fines for misconduct. (AFP)