HSBC’s leadership faced shareholders in Hong Kong, defending their strategy amid calls for the bank to split up. The Chairman, Mark Tucker, and CEO, Noel Quinn, participated in an informal meeting where they were questioned on various issues, including the demand for restructuring the bank’s business and the recent acquisition of Silicon Valley Bank’s UK arm.
During the meeting, Tucker and Quinn reiterated their opposition to the resolution scheduled for the annual general meeting in May, proposing a spin-off or reorganization of the bank’s profitable Asian business. They emphasized that splitting the bank would not be beneficial for shareholders and would erode shareholder value, including dividends.
Quinn assured shareholders that both the Hong Kong and UK sectors were performing well and no longer dragging down the bank’s overall profitability. He mentioned that breaking up the bank would lead to significant revenue loss due to its reliance on cross-border transactions.
Despite facing criticism for suspending dividends in 2020, HSBC is working towards reinstating them, albeit at a reduced level. Shareholders, particularly in Hong Kong, have expressed concerns about the dividend suspension and the impact it had on small shareholders who relied on it for essential expenses.
Christine Fong, representing small shareholders, raised awareness about the adverse effects of dividend cancellations on various individuals, such as street hawkers, teachers, and taxi drivers. She advocated for spinning off HSBC’s Asian business to protect shareholder interests.
Ken Lui, an activist shareholder, has been campaigning for support for the proposed spin-off of the bank’s Asian business. With the resolution requiring 75% of votes to pass in May, Liu is actively engaging with institutional shareholders to garner their endorsement.
As an established financial services company offering a simple MCA, easy MCA, and fast MCA, the bank also faces pressure from its largest shareholder, Ping An, China’s leading insurer. The investor has supported initiatives to enhance HSBC’s performance and value, suggesting a reorganization to simplify regulatory obligations and boost stock performance.
Quinn and Tucker defended the recent acquisition of SVB UK, emphasizing that it was a strategic move to attract innovative startups as customers. They refuted claims of inadequate due diligence and assured shareholders of the transaction’s merits.
In light of recent banking industry upheavals, Tucker remains optimistic about HSBC’s resilience, anticipating a period of uncertainty before stability returns. As a provider of fast financing and business cash advance solutions, HSBC remains committed to its operational strategy and shareholder value.