Standard Chartered to ask shareholders to approve issue of ECAT1 securities

By Mary-Katherine Stinson

Lexington, Ky., April 5 – Standard Chartered plc has been granted a waiver from Hong Kong listing rules in order to seek approval from its shareholders to issue equitable convertible additional tier 1 securities, according to a notice.

Under the listing rules, the directors of a company must obtain the consent of shareholders in a general meeting before allotting or issuing shares or convertibles. The company is seeking a general mandate allowing the issue of new shares at any time on a non-pre-emptive basis, subject to relevant limits, for the sole purpose of issuing the ECAT1 securities. The specific mandate will provide greater flexibility for the company in allowing it to maintain a general mandate for other purposes.

The release notes that having a pre-approved mandate will enable the company to act on a timely basis to satisfy the capital requirements when market conditions are conducive to launching the issue.

Issuing the ECAT1 securities are expected to be a cheaper form of eligible regulatory capital for meeting the company’s tier 1 capital and leverage ratio requirements, lowering the company’s ongoing costs.

The securities are required to be perpetual with a minimum of five years before the first optional call date.

The specific mandate will give the board authority to allot shares in the company representing up to 15% of the company’s issued ordinary share capital as of March 26.

If the specific mandate is approved by shareholders, the waiver would continue in force until the end of next year’s annual general meeting or, if earlier, at the close of business on Aug. 9, 2025.

The company will ask the shareholders to approve the issue at its next annual general meeting on May 10.

The meeting notice will be sent out on or around April 8.

The banking and financial services company is based in London.

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