Standard Chartered’s surprise £3.26bn rights issue has raised the bar for European peers and could force them to follow suit, analysts said, potentially cutting into shareholder returns.

The UK-based, Asia-focused bank said it will raise the new shares to boost its Core Tier 1 capital ratio to around 10% under new Basel III rules, which require banks by 2019 to hold 7% in core capital against their assets, plus a buffer of up to 2.5% that can be implemented at the discretion of national regulators, depending on perceived risks in the financial system.