"Simply the best, better than all the rest," was one analyst's verdict on Standard Chartered last week, reflecting the sense that the bank is different from any other listed in London.
Apparently it is all the fault of a 'rogue regulator'. Maybe so, but from Wikipedia:
The Shanghai branch of Chartered bank began operation in August 1858. Initially, the bank's business dealt specifically with large volume discounting and re-discounting of opium and cotton bills. Although there was a gradual rise in opium cultivation in China, the imports of opium still increased from 50,087 picul in 1863 to 82,61 picul by 1888. Transactions in the opium trade generated substantial profits for Chartered bank.
In 1992, scandal broke when banking regulators charged several employees of Standard Chartered in Mumbai with illegally diverting depositors’ funds to speculate in the stock market. Fines by Indian regulators and provisions for losses cost the bank almost 350 million pounds, a third of its capital.
Scandal erupted again in 1994, when the Sunday Times of London wrote that an executive in the bank’s metals-trading arm had bribed officials in Malaysia and the Philippines in order to win business. The bank, in a statement on 18 July 1994, said there were “discrepancies in expense claims” that “included gifts to individuals in certain countries to facilitate business, a practice contrary to bank rules.'
In 1997, Standard Chartered sold its metals trading arm to Toronto-based Scotiabank for US$26 million. In 1994, the Hong Kong Securities and Futures Commission found that Standard Chartered’s Asian investment bank had illegally helped to artificially support the price of new shares they had underwritten for six companies from July 1991 to March 1993. The bank admitted the offense, apologized and reorganized its brokerage units. The commission banned the bank from underwriting IPOs in Hong Kong for nine months. Standard Chartered’s Asian investment banking operations never recovered, and in 2000 the bank closed them down.
The bank fully recovered in late '90s, during this time, the bank sold off holdings in continental Europe and the Americas, sold the headquarters building (lease-back) and branch properties in Hong Kong. In 2000, Standard Chartered acquired Grindlays Bank & Chase Manhattan Bank Hong Kong retail banking business. The ethics issues and financial losses triggered turmoil in Standard Chartered’s London executive suite. The bank went through three CEOs in three years: Malcolm Williamson was replaced in 1998 by Rana Talwar, who was in turn unseated by Mervyn Davies in 2001. By the time Davies took over, his predecessors had systematically sold off the bank’s holdings in continental Europe and the Americas.
