Standard Chartered PLC (LSE:STAN) was the best-performing FTSE 350 banking share on Tuesday after being upgraded to 'buy' by Deutsche Bank, which said the lender is better placed than peers to benefit from the rapid expansion of Asian wealth management.
Analyst Robert Noble raised his target price on Stan Chart to 2,400p from 1,900p, saying he expects the bank's wealth business to help drive 19% compound annual growth in group earnings per share over the next three years.
Asian wealth management represents a significant opportunity for the UK's internationally focused banks, he said, noting assets under management growing faster than in other regions.
That trend is expected to continue as households move money from bank deposits into investment products.
The analyst noted that Standard Chartered has grown its wealth business faster than peers over the past three years and believes further expansion will support earnings growth across the group.
By contrast, for fellow Asia-focused lender HSBC Holdings PLC (LSE:HSBA), Deutsche's 'hold' rating was maintained, although the target price was increased to 1,520p from 1,450p.
Noble said both banks are exposed to the structural growth of Asian wealth management, but it sees greater upside potential in Standard Chartered's shares.
