HSBC CEO announces surprise retirement

HSBC CEO announces surprise retirement

Hong Kong — HSBC has announced the retirement of its chief executive Noel Quinn — a surprise departure for its hard-nosed leader of five years who oversaw a series of wide-ranging asset sales around the world.

The Asia-focused bank said in a statement today that it has launched a formal process to find a replacement.

Chief financial officer Georges Elhedery, who was appointed to position No. 2 in January 2023, is likely to be the leading internal candidate for the position.

Quinn, 62, has restored momentum to the bank’s profits and share price by shedding or downsizing underperforming businesses, including the lender’s retail banking business in the United States and France, an entire Canadian subsidiary and units in smaller markets such as Argentina.

Shares of HSBC (HSBC), which has gained about 30% over its tenure, rose about 1.3% and hit a nine-month high in the afternoon session in Hong Kong.

“I think shrinking business in Western markets such as the US, Canada and Europe is a good move for HSBC at the same time as growing the group’s Asian business,” said Simon Yuen, founder of Hong Kong-based Surich Asset Management, which is a shareholder HSBC.

“We hope that the next CEO will present more plans, in terms of implementation, to further improve the bank’s business in Asian countries,” he added.

Quinn will remain CEO until his successor begins the role.

“I’ve held an intensive leadership role since I took on the commercial bank role in October 2008, so I’m personally ready for a change,” Quinn told reporters on the call.

“It is also a natural inflection point for the bank, as it approaches the end of its current transformation phase. It is the right time to bring leadership to move the bank forward over the next five years.”

HSBC chairman Mark Tucker said the bank aimed to complete the Quinn replacement process by the second half of the year.

“He (Quinn) first brought this to my attention earlier this month,” Tucker said of the timing of Quinn’s decision to step down, adding that the decision was Quinn’s and the board supported him.

Driving challenges
Quinn, who joined HSBC in 1987, was named chief executive of the bank, which generates most of its revenue and profits in Asia, in March 2020, after serving as interim CEO following the surprise ouster of his predecessor.

He played a key role in navigating the challenges during and after the coronavirus outbreak, as well as heightened geopolitical tensions affecting the bank’s main market, China.

He also won a big fight with Asian investor No. 1 bank, Ping An Insurance China, which ran a multi-year campaign to try and get HSBC to spin off its Asian business, which ended in defeat at the bank’s shareholder meeting last year.

HSBC has also faced criticism in recent years from Western lawmakers over its dealings with China amid rising geopolitical tensions. Hong Kong is HSBC’s largest single market worldwide.

HSBC reported pretax profit of $12.7 billion, slightly ahead of forecasts, for the quarter ended March compared with $12.9 billion a year earlier, as it struggled to cope with rising costs from expansion in Asia.

The London-headquartered bank also announced a $3 billion share buyback on top of the $2 billion share buyback announced in February.

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