17 Dec, 2015 17:48 17 Dec, 2015 18:38

Temasek will wait before deciding on StanChart stake

Standard Chartered got a boost from a report that a sovereign wealth fund was willing to give it more breathing room to successfully complete its turnaround, before deciding what to do with its stake in the lender.

Banks

3,820.70

16:39 07/02/23

1.36%

51.22

FTSE 100

7,864.71

16:38 07/02/23

n/a

FTSE 350

4,350.82

16:39 07/02/23

n/a

FTSE All-Share

4,309.87

17:14 07/02/23

n/a

Standard Chartered

682.60p

16:55 07/02/23

1.67%

11.20p

Reuters reported that, for the moment, Singapore´s SWF, Temasek, would hold off from deciding the fate of its approximately £2.6bn stake in the Asia-focused lender.

In a vote of confidence for the bank, in a research note sent on 16 December analysts at JP Morgan said that following the recent successful $5.2bn rights issue and after the Bank of England´s stress tests, in their view investors´ capital concerns had been adressed.

Trading on 0.6 times price-to-tangible net asset value, StanChart shares were reflecting a downbeat outlook for the banks´ non-performing loans in emerging markets. However, the stock price was not discounting the now lower downside risks and positive earnings gearing to higher US rates from chief Bill Winter´s new strategy.

JP Morgan analyst Raul Sinha reiterated his 'overweight' recommendation and 870p target price on the shares.