Standard Chartered has announced plans for a £3.3 billion rights issue ahead of new capital rules that will force the banking industry to stockpile cash.
The emerging market-focused bank says it wants to raise cash ahead of the Basel III rules, which aim to prevent a repeat of the financial crisis.
The bank says the cash will also allow it to “continue to seize opportunities” across Asia, Africa and the middle east. (article continues below)
Standard Chartered shareholders who take up their rights will receive one new share for every eight they currently own. The issue price of £12.80 for each new share represents a discount of 33% on Friday’s closing price, the group says.
Peter Sands, the chief executive of Standard Chartered, says: “We are launching this rights issue to ensure that we can continue our strong record of organic growth and take full advantage of these opportunities, while at the same time being prepared for likely increases in capital requirements resulting from Basel III implementation.”