My lazy work day was awoken when a fellow blogger informed me that Standard Charted will be exiting the intuitional cash equities, equity research and equities capital market.
Channel News Asia have an announcement here. This give you an idea how in tune with market news I am. I am really quite passive about it during working hours.
Obviously I am very disappointed if my SCB Online trading is impacted:
- It is my main trading platform because there are no minimum commission charges and it is a reason why I consistently have emails asking me why my commission is so low on my portfolio here.
- No custodian charges
- No dividend handling charges
- Assess to various markets
I actually really like the service.
The thing is, even their staff are rather shocked about this news. I think they are more anxious if this will affect their business unit more than anything. The message is very vague but if SCB online trading is making use of the equity capital market, then this will affect the consumers as well.
What I felt after consulting some ex brokers and from call in is that it is likely MAS would arrange an orderly transfer to another custodian, which may or may not be your choosing. The fear is whether there will be transfer charges and it will be catastrophic if there are. Already we are seeing from hardwarezone there are people selling out this morning and afternoon.
As far as we know, it is likely a transfer into CDP there will be a per counter charge and there shouldn’t be a charge levied at SCB Online trading end.
Lets not jump the gun. Lets wait until things becomes clearer.
Kyith is the Owner and Sole Writer behind Investment Moats. Readers tune in to Investment Moats to learn and build stronger, firmer wealth foundations, how to have a Passive investment strategy, know more about investing in REITs and the nuts and bolts of Active Investing.
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Kyith worked as an IT operations engineer from 2004 to 2019. Currently, he works as a Senior Solutions Specialist in Fee-only Wealth Advisory firm Providend. All opinions on Investment Moats are his own and does not represent the views of Providend.
You can view Kyith's current portfolio here, which uses his Free Google Stock Portfolio Tracker.
His investment broker of choice is Interactive Brokers, which allows him to invest in securities from different exchanges all over the world, at very low commission rates, without custodian fees, near spot currency rates.
You can read more about Kyith here.
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Tan
Monday 16th of March 2015
Hi. Do u think that the online brokerage may jus shut down like what they did to their institutional business.
What if they did? Whats gg to happen to those shares under their custodian?
Kyith
Tuesday 17th of March 2015
Hi Tan, shares are held in a trustee account and MAS should do an orderly tranisition to another brokerage. That may or maynot be within our control.
RetailTrader
Saturday 10th of January 2015
On a bigger picture scale, this smacks of bad client management to me that erodes the trust of customers. FrankIy, I would start looking for new alternatives if I was using SCB.
Kyith
Saturday 10th of January 2015
Hi RetailTrader,
I do agree on the poor communication part. But there are no perfect platform. I heard from my friend that despite a reduction in the board lot to 100 shares, the traditional brokerages are still charging a minimum of 25 bucks. There is seldom something that is best in everything.
ken
Thursday 8th of January 2015
i just called the SCB Helpline, and they said the retail business isnt affected. SCB online trading isn't shutting down. That said, who knows?? Anything can happen in the end.
Matthias Kauer
Tuesday 13th of January 2015
thank you very much for sharing this Ken!
Kyith
Friday 9th of January 2015
Hi Ken thanks for checking. Let's see if there are more news. They should have sent a mail stating things are OK.
H
Thursday 8th of January 2015
i was a little concerned as well, until i noticed it mentioned "institutional" cash equities, equities capital market etc etc. on their official press release, so i placed a call - retail equities trading will not be affected.
it would be hard to believe SCB will want to cut their retail business, given that they are "spearheading" the no-min-commission discount trading model here which is well-loved by many.
hazarding a guess, it seems that SCB is leaning towards investment banking activities, (FICC trading & some capital markets advisory?) and perhaps looking to have everything retail to be put online (so less branches needed).
Boon
Thursday 8th of January 2015
https://www.sc.com/en/news-and-media/news/global/2015-01-08-taking-further-action-on-strategic-plan.html
The announcement mentioned quite clearly "institutional" a.k.a corporate and institutional. Not sure why everyone panic ;)
Cheers!