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Standard Chartered Bank, India's largest foreign lender in branch network, will not remain insulated from the global restructuring the lender is undertaking. However, people familiar with the development say the impact in India will be limited.
"Since it is a global restructuring, there is no way India can escape being impacted. However, the impact will be felt most at the senior level, where there will be consolidation and realignment of jobs. It might percolate to the lower level as well but that won't be significant," said an informed source, requesting anonymity.
The rationale for the top management being hit the most was simple, explained another person. "This is part of the cost cutting exercise and the letting go of some people at the top will translate into higher savings compared to the ones at the junior level."
It is likely that the restructuring will be over in the next 30-45 days. StanChart did not comment on it.
This is part of the bank's overall strategy to deliver at least $400 million of cost saving targeted for 2015. It has closed several non-core operations. As a part of this, it had earlier closed its institutional cash equities, equity research and equity capital market businesses in India. And, asked 25-30 people to leave.
Globally, the bank has closed 74 branches and 'rationalised' a further 20. Staffers are down by 4,000 from a year before. The bank had said it would not be replacing staff when they left.
The bank has also aligned its eight earlier regions into four new regional businesses - Asean & South Asia, Africa & Middle East, Greater China & North Asia, Europe & Americas.
Standard Chartered India reported 93 per cent growth in net profit in FY14 but in the first half of the calendar year the group's profit declined. The bank posted a $276-million loss in the January-June period, versus a profit of $395 million a year earlier.
