Jefferies sees StanChart announcing share buy-back reload alongside Q2 results

Analysts at Jefferies reiterated their 'buy' recommendation for shares of StanChart, highlighting the potential now for the lender to re-load its buy-back programme for the second quarter.

StanChart finished the first quarter with a Common Equity Tier 1 capital cushion of 13.9% after removing $6.5bn of risk weighted assets linked to corporate business with lower returns.

And while they were looking for further confirmation on those RWA savings at the lender's 134 June webinar, they said the savings confirmed their expectations were for a further $500m of buybacks to be announced alongside StanChart's second quarter results.

Through 2024, they were anticipating a cumulative capital return of $5.4bn.

The analysts also bumped up their revenue estimates for 2022-24 by 3.0% on average after embedding a cumulative 150 basis points of Fed interest rate hikes for the period, on top of the prior 75bp foreseen.

All told, they bumped up their estimates for StanChart's net interest income over 2022-24 by 11%, leaving them 2.0% ahead of the analyst consensus.

Jefferies had a target price of 991.0p on the shares.