Standard Chartered Makes Land Grab For Asia Chief

Standard Chartered Makes Land Grab For Asia Chief
Vivian Wai-yin Kwok, 05.30.07, 10:57 PM ET



HONG KONG - Standard Chartered Bank has always had its own way of doing business. The London-based lender, which has scratched out profits in emerging markets ignored by its peers, surprised the banking world this week by appointing Nicholas Sallnow-Smith, a real estate veteran and former CEO of Hongkong Land, to head its operations in Northeast Asia.

The appointment reportedly has caused consternation at the troubled Hong Kong real estate investment trust Link (other-otc: LKREF - news - people ), where Sallnow-Smith took on the role of non-executive chairman in April.

On July 1, Sallnow-Smith will assume the post of regional chief executive at Standard Chartered (other-otc: SCBFF - news - people ) responsible for China, Hong Kong, Taiwan and South Korea.

He will be stationed in Hong Kong, a city to which he is no stranger. From 2000 through March this year, Sallnow-Smith headed Hongkong Land, a unit of Jardine Matheson that is the biggest landlord in Hong Kong’s financial district.

Sallnow-Smith has over 13 years experience in Asia with Hongkong Land and Jardine Matheson. Before that he worked in London, including 10 years with Her Majesty’s Treasury.

“Nicholas Sallnow-Smith is a highly experienced senior executive whose background matches our businesses and footprint,” said Kai Nargolwala, Standard Chartered’s executive director, in a statement.

Still, it’s quite uncommon to hire a property specialist to run a banking operation.

Sallnow-Smith’s move appeared to be yet more bad news for the REIT Link, a batch of formerly state-owned shopping malls and parking lots that were badly run before they were controversially privatized.

Given his strong real estate background, Sallnow-Smith was expected to help elevate the REIT’s profitability.

Sallnow-Smith said he would hold onto his Link position despite taking the Standard Chartered job, but key investors are reportedly unhappy with his move and speculation was rife that he would bow out.

Three senior executives have left Link in the past few months amid strong opposition from public housing tenants and repeated demands for drastic rent hikes from the Children's Investment Fund, a British hedge fund that holds 18.35% of the REIT.

Standard Chartered reported a record net profit of $2.2 billion in 2006, with over 90% of its earnings coming from Asia, Africa and the Middle East.

It is moving aggressively to expand. The bank acquired Union Bank in Pakistan and Hsinchu International Bank in Taiwan last year.