Shareholders put pressure on HSBC’s top executives to consider company breakup
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HSBC’s top brass passionately defended their strategy on Monday to shareholders in the lender’s largest market, as calls for the bank to be split up continue. Chairman Mark Tucker and CEO Noel Quinn impressed investors in Hong Kong with their clear approach to various concerns raised by shareholders, ranging from business restructuring demands to the recent purchase of Silicon Valley Bank’s UK division.
In dense remarks, Tucker and Quinn reassured shareholders that splitting the bank would not be beneficial as the board is united in its opposition to such a move. The strategic focus has been on enhancing dividends for the shareholders as well as ensuring that the current strategy stays intact.
Despite facing pressure to segregate its Asian business from the rest of the bank, HSBC’s leadership emphasized that the bank, as a whole, is performing well. Shareholders contended that the London-based bank’s performance had been negatively impacted by its businesses in other regions.
Efforts to secure the proposal for the bank to spin off its Asian business are underway. Christine Fong, representing small shareholders affected by the dividend cancellation, highlighted the impact on everyday people who rely on dividends for their expenses.
Advocates for the spin-off are focusing on garnering support for the resolution ahead of the upcoming meeting in May. HSBC’s prominent shareholder, Ping An, has backed calls for the bank to reconsider its structure to improve performance and value. The insurance giant remains firm on its stance for HSBC to explore a reorganization.
HSBC’s recent acquisition of SVB UK came under scrutiny, with critics questioning the due diligence process. Quinn and Tucker defended the acquisition, emphasizing the business benefits gained. They also commented on the industry’s recent challenges but expressed confidence in the bank’s resilience in the face of uncertainties.
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