Bill Winters takes top Standard Chartered job: The City’s favourite adopted son takes on a risky challenge
Not many investment bankers’ names are greeted with utterly unmitigated praise, particularly ones with major roles in the financial crisis.
But once you ask former colleagues of Bill Winters about his qualities, it is hard to stop the flood of superlatives.
“He is the best leader I have ever met. He saved the bank in 2008, he is absolutely knowledgable on risk, Standard Chartered is so lucky to get him,” gushed one former JP Morgan colleague. “I would follow him anywhere in the world.”
That Winters inspires such support six years after leaving JP Morgan tells you something about his stature at the bank – it is often said that the giant bank’s chief executive and chairman Jamie Dimon saw him as a serious threat to his own position.
It is not only Winters’ professional abilities which gain compliments. His charm and personality are also attractive. “He is a really international person, unlike so many Americans. He is a real universal man, he is everything London should embrace,” continued the same former colleague.
The incoming boss of Standard Chartered has also had an impact beyond the private sector.
Winters worked on the Independent Commission on Banking, and its chairman Sir John Vickers praises him as “a wonderful colleague”, congratulating Standard Chartered on picking him.
The similarly influential Andrew Tyrie MP, who chaired the Parliamentary Commission on Banking Standards, speaks of Winters’ “highly valued” contribution to that investigation.
How is this going to translate into his leadership at StanChart, a globe-straddling bank which is struggling to drag itself out of a period of stagnation?
City grandee Sir Roger Carr expects Winters’ personal qualities to infect the workforce at the bank with the enthusiasm they need right now.
“He has an excellent pedigree, a first class banking track record and a very sound reputation with the regulatory authorities. This is a good appointment, and that has been reflected in the share price,” Carr told Morning Wire
The pair came into contact through work at the Bank of England, where Winters wrote an influential report on liquidity in the banking system.
“I found him to be very effective, skilled and able, and you will tend to find with people like that, that others follow them positively and with commitment,” said Carr. “That should give him a strong start at StanChart.”
StanChart itself has its problems, and Winters has his work cut out for him. The bank racked up record profits in each year for a decade, performing strongly throughout the financial crisis, in part because its emerging markets focus insulated it from the woes of Europe and the US.
Its share price has halved in the past two years, leading to the pressure which ultimately forced out long-term chief exec Peter Sands. Winters issued a flattering statement yesterday, saying Sands has “forged Standard Chartered into one of the truly great opportunities in global banking. It’s a special bank.” But that has does not disguise the fact that Winters faces a tough job turning the bank around and really making the most of those opportunities offered by StanChart’s focus in Asian and African growth markets.
This is the only point at which any doubt creeps into the voices of those who know him well – Winters’ experience is entirely on the wholesale side, as a veteran investment banker. In the time since he left JP Morgan, he set up asset management firm Renshaw Bay.
By contrast, StanChart has major retail banking operations, private banking for wealthy individuals and extensive small business banking divisions.
Similarly, Winters has largely been based in London. He has travelled extensively and understands global markets, but that is not the same as running a truely emerging markets bank.
This does not seem to worry chairman Sir John Peace – who also handed in his notice yesterday – or investors.
“Bill has an exceptional understanding of the global regulatory conduct environment – as a CEO this is something you can’t learn on the job,” said Peace. The chairman is relying on Winters’ ability to really lead the bank: “He’s also a proven leader with a strong track record in nurturing and developing talent.”
The jump in the share price yesterday shows investors agree with that initial assessment – but after such a precipitous fall in the value of their shares over the past two years, those investors will be keen to see some results fast from StanChart’s great new hope.
And that is surely a risk for a banker currently lauded by everyone he meets – great reputations can be lost in a moment if things go wrong. Just witness Peter Sands’ fall from highly respected bank boss at the end of the crisis, to being forced out yesterday.
TOP OF THE IN TRAY…
■ Winters faces serious challenges over the bank’s financial strength. Investors will want to know whether he will cut the dividend or even raise funds with a rights issue.
■ Standard Chartered specialises in emerging markets, but is not doing well everywhere. Winters will have to make a decision on the future of the troubled South Korean unit.
■ The bank has gone through a huge restructuring into three main business lines – corporate and institutional banking; commercial and private banking; and retail banking. It is down to Winters to squeeze the much-needed efficiency gains from this new setup.