Standard Chartered

Global expansion has been the dominant theme for Standard Chartered over the past two years.

The consumer, corporate and institutional banking and treasury services specialist has a presence in 50 countries and is still growing.

In 1998, Standard Chartered consolidated its presence in the Latin American market by acquiring Extebandes, now Banco Standard Chartered, before buying Thailand’s Nakornthon Bank and the non-Swiss trade financing operations of the Union Bank of Switzerland.

On 1 May, Standard Chartered announced the acquisition of Australia and New Zealand banking group’s Grindlays’ operations in South Asia and the Middle East.

At present the contracts are just being signed, with completion expected in the next few months.

Commenting on the effect that the deal has had on the London-based eight-strong legal and compliance office, Martin Hayman, head of legal and company secretary at Standard Chartered, says: “It’s stretching them to twanging point. Fortunately they are all very flexible and have a lot of energy.”

Five of the in-house lawyers have been devoting their time to the deal for most of the year. The transaction affects every country in East Asia as well as jurisdictions in the Middle East. Hayman says: “It’s taking up an enormous amount of time. Deals that affect one country take time, but those that affect 15 or 16 jurisdictions take a considerable period of time. They involve a whole raft of legal and regulatory issues.”

Slaughter and May is advising on the deal since Hayman values its international experience. He adds that the firm’s decision not to merge with practices in Europe, as other UK firms have, does not concern him when it comes to using it outside its immediate jurisdiction.

The company also has long-standing relationships with Lovells, which Hayman favours for banking, and Herbert Smith for dispute resolution.

Hayman says: “Both are experts in their field. We go to them for good quality of service. We need to know we are getting what we want, where and when we want it.”

Allen & Overy also features on Standard Chartered’s small panel for UK advice while the majority of international work is outsourced to Clifford Chance, Baker & McKenzie, Slaughter and May and Lovells.

But Hayman says relationships with niche firms, such as Lawrence Jones for trade finance advice, are also important.

The line-up of firms is fairly static. He says: “We tend not to change firms. We stick with a relationship. It’s the best way for them to learn about our business and our priorities and strategies.” Although he adds: “None of this is taken for granted by us or them. We have regular reviews with most of them.”

Lawyer’s fees are reviewed at an international level and although the company does not use a retendering process it is currently looking at its international service providers in all areas, including its legal advisers. Hayman says: “We are looking to see whether we are getting the most cost effective use of our resources.”

But while the bank returns to the same UK firms for most work, in some cases, specifically internationally, Standard Chartered is not afraid to break with its usual panel in favour of practices with experience in a particular jurisdiction.

When the company bought Extebandes in Latin America in 1998, its main adviser was US firm Morgan Lewis & Bockius.

Local firms in Columbia, Peru and Venezuela also worked on the deal, with their progress monitored by Hayman’s London team.

Hayman says that both he and his in-house team take a very hands-on approach to the way that they work with external advisers, while making sure that they retain a large amount of work internally.

Two of his team focus mainly on dispute resolution, two lawyers work on mergers and acquisitions and disposals while another two focus exclusively on technology, including e-banking and e-commerce.

Hayman’s deputy Kate Nealon is a fully qualified US attorney and is group head of compliance.

Litigation also provides plenty of work for the in-house team and matters involving more than $10m (£6.6m) are managed from London.

Hayman says: “If a matter could impact on the group, we will get involved. Our role then will be to see if we have appropriate legal advice. We work closely with external lawyers to check on their approach.”

He adds: “We have had a considerable amount of litigation around the world that we have managed well.”

Standard Chartered has another 80 lawyers scattered around the globe, providing local legal services and acting as its eyes and ears on the ground.

And its international experience is extensive. When Standard Chartered bought Nakornthon Bank in 1999, one of its lawyers spent 11 months working in the small management team in Thailand. His role was “making sure we bought this thing and integrating it effectively into the legal and regulatory structure”.

Another team member recently spent four months in Jakarta. Hayman says: “That was at a pretty troublesome time, which raised political, economic, contractual and personal issues. These are very senior lawyers capable of looking after themselves in difficult environments.”
Martin Hayman
Head of legal
Standard Chartered

Statistics
Organisation Standard Chartered
Sector Banking
FTSE 100 rating 34
Market capitalisation £8.8bn
Employees 25000 worldwide
Head of legal Martin Hayman
Reporting to chief executive Gurvirendra Singh Talwar and chairman Patrick Gillam
Main location for lawyers London
Main law firms Allen & Overy, Baker & McKenzie, Clifford Chance, Herbert Smith, Lawrence Jones, Lovells and Slaughter and May