Standard Chartered said in May that some prospective buyers have already approached it to buy its wealth and retail business. Photo / Isaac Kasamani
In November last year, Standard Chartered Bank announced that it would, within 18 and 24 months, have completed its exit from retail and mass‑market wealth banking business.
The exit, the bank said then, is a strategic refocus on corporate and affluent clients.
It was a sharp turn for a bank that, for over a century, had played in the retail league, which, admittedly, according to chief executive officer Sanjay Rughani, had grown in “leaps and bounds,” but only that it was no longer meeting the group’s expectations for scale and profitability.
Thus, Rughani said, the decision reflected “leadership maturity”- but also a clear-eyed calculation – of withdrawing capital from segments with low returns and deploying it in more rewarding businesses.
This is not unique to Uganda. Retail banking in low-to middle-income countries is notoriously difficult to scale profitably.
Different people spoken to for this article admit that serving millions of small-balance accounts demands costly infrastructure, yet the margins are razor-thin.
Thus, Standard Chartered’s shift places it in a niche market that plays to its strengths - cross-border capabilities, capital markets expertise, and global advisory networks.
These clients don’t just need savings accounts—they seek wealth preservation tools, estate planning, currency hedging, and access to international financial markets.
Crucially, these services come with higher margins and fewer customers to manage, according to reputable financial research firms like McKinsey & Company and Deloitte.
And the timing of the shift aligns with the evolving economic landscape.
With oil and gas development, large-scale infrastructure projects, and deepening regional integration, the country is edging closer to the ten-fold economy that projects to have grown from $60b to $500b in the next 15 years.
In this context, Standard Chartered sees more strategic value in financing trade, structuring project finance deals, and providing advisory services to governments, insurers, and development finance institutions.
The bank says it has contributed about $800m in value-added output financing in Uganda and has financed infrastructure projects worth over $1b.
Its financials show profits have been growing steadily at 5 to 6 percent annually, even with the retail business in place.
By shedding the lower-margin retail segment, the bank hopes to accelerate that growth further.
What is being sold exactly?
The “wealth and retail” unit includes all individual savings and current accounts, offshore mutual funds such as SC Shillingi, a unit trust investment vehicle, personal loans, fixed deposits, and SME banking.
What remains is a bank focused almost exclusively on large institutions, government entities, multinationals, and affluent individuals with global needs.
Standard Chartered has taken similar steps in Zambia and Botswana and is also investing more heavily in growth markets like Egypt and Saudi Arabia.
In a sense, Uganda is a casualty of internal capital reallocation.
How is the transaction progressing?
In May, Rughani said a number of major banks had expressed interest in the retail and wealth business.
“I believe that in the third quarter of this year, we will be in a better position to communicate who are possibly the front runners, or the top one in essence. We are currently carrying out a lot of due diligence since it’s a professional process, and it goes through different efforts,” he said then.
But finding a buyer who can absorb that portfolio and serve its customers effectively is no small feat.
In other markets, such exits have occasionally led to disruptions in service and confusion around account migration, risks that Stanchart will be eager to avoid.
For example, when Citibank exited retail banking in India in 2022, its customer accounts were transferred to Axis Bank, resulting in confusion among clients over new terms, digital access, and service continuity, despite assurances of a smooth transition.
Could this prompt a wider market shift?
Dr Fred Muhumuza, an economist, says banks are increasingly shifting focus toward affluent individuals and institutions due to their high-margin potential.
However, this comes with its own set of challenges, chief among them being the need for a strong capital base to meet large cash demands associated with lending to big-ticket clients.
“Deposits are no longer as high as they used to be. Banks are struggling to sustain [retail banking] because of high operational costs,” he says.
On his part, Rughani says that Uganda is becoming a gateway to a 300 million-person East African market, which presents big-ticket prospects.
“These investors, and the enterprises they will back, are those that would need structured finance, trade services, green financing, and policy support - all areas where Standard Chartered wants to lead,” he says, and notes that affluent segment offers a compelling value proposition: higher margins, cross-selling opportunities, and a greater demand for sophisticated financial products such as investment advisory, wealth preservation, estate planning, and international banking.
Global trend
Standard Chartered’s pivot mirrors a broader global trend: banks are shedding low-yield retail units in favor of high-value, wealth-focused strategies.
HSBC, for example, has ramped up its wealth business in Asia, while Citi exited retail in 13 markets to focus on institutional clients.
Even African players like Absa and Nedbank are doubling down on private banking to capture the continent’s rising affluent class.
These clients tend to be less price sensitive and more loyal, enabling banks to build long-term, profitable relationships.
In Uganda, rising middle and upper classes, expanding entrepreneurship, and growing regional wealth flows create fertile ground for wealth management services.
Standard Chartered’s rich international network positions it well to serve this clientele.
Post-exit, Standard Chartered will consolidate operations under corporate and investment banking, with a focus on sovereign clients, development finance institutions, commercial banks, insurers, fund managers, and global corporates like MTN and Airtel.
It’s a high-stakes shift that signals the bank’s commitment to complex, large-scale financial services where global networks and deep balance sheets matter most.
Risks and trade-offs
It’s a bold move but not without risks. Narrowing the client base exposes the bank to concentration risks, especially if economic or political shocks disproportionately impact the corporate or affluent segments.
On Tuesday, Rughani told Monitor that Standard Chartered is following accounting standards - internationally recognized - to facilitate a smooth and clear transition for investors and regulators during the sale and restructuring process.
“This change is expected toward the end of next year. Until then, our financial statements will continue to be published in the usual way. After that, we will operate as a single business focused on corporate and investment banking,” he said.
He added that proceeds from selling the retail and wealth business will generate value that the bank plans to reinvest into expanding other areas of its operations, which will give it “different products across various segments [allowing] us to grow across all of them” as well as relaunch new products that offer greater opportunities for the bank's clients.
Implication
Financially, exiting retail banking, Rughani says, will free up capital that can be redirected toward higher-yield products and institutional growth as well as fueling asset expansion, improving client returns, and supporting product diversification.
However, the new focus demands different operational capabilities. Expertise in wealth management, risk assessment, and capital markets will be essential - skills that Rughani confidently affirms the bank possesses.
Ultimately, the next 24 months will be a critical test of whether Standard Chartered’s sharpened strategy delivers stronger returns without sacrificing its relevance.
In doing so, the bank may set a blueprint - or a cautionary tale—for how international financial institutions adapt to the evolving landscape of African banking.
