HSBC boss in shock exit as bank warns of ‘challenging’ times

 

 

HSBC on Monday announced the shock exit of chief executive John Flint, but denied talk of a management split as it also axed 4 000 jobs and warned of dark clouds on the horizon.

The London-headquartered lender gave no reason for Flint’s sudden departure after just 18 months in the job, but said there was “no personal clash”, adding it needed a change at the top.

Asia-focused HSBC also revealed it would axe 2% of its global workforce, or roughly 4 000 mostly management jobs, in a new restructuring aimed at weathering global turmoil.

“HSBC Holdings plc announces that John Flint has today stepped down as Group Chief Executive and as a director by mutual agreement with the board,” read a statement.

The exact amount Flint will get as a payoff remains unknown until he leaves.

‘No personal clash’ 

Monday’s surprise news came shortly before HSBC reported first-half net profit up 18.6% at $8.5-billion from a year earlier.

“In the increasingly complex and challenging global environment in which the bank operates, the board believes a change is needed to meet the challenges that we face and to capture the very significant opportunities before us,” said chairman Mark Tucker.

Addressing rumours that Flint was pushed out after a management bust-up, Tucker later told reporters that there had been “no personal clash” and “no disagreement over strategy”.

Flint, 51, who has spent three decades at HSBC, was keen to lower costs with HSBC facing the double uncertainties caused by the US-China trade war and Brexit.

“I have agreed with the board that today’s good interim results indicate that this is the right time for change, both for me and the bank,” he said.

Flint replaced Stuart Gulliver, who had embarked on a huge restructuring programme to axe 50 000 jobs and exit core markets.

Gulliver also decided to switch 1000 jobs to Paris from London owing to Britain’s looming departure from the European Union.

HSBC said its commercial banking division chief Noel Quinn would serve as interim CEO.

‘Outlook has changed’

The lender on Monday added that it planned a buyback of HSBC shares worth up to $1-billion.

“The outlook has changed,” the bank said.

“Interest rates in the US dollar bloc are now expected to fall rather than rise, and geopolitical issues could impact a significant number of our major markets.”

HSBC added: “In the near term, the nature and impact of the UK’s departure from the European Union remain highly uncertain.

“We are managing operating expenses and investment spending in line with the increased risks to revenue.”

In late morning London deals, HSBC shares slid 1.3% to 637.70 pence on the FTSE 100 index, which was down 1.9% overall.

© Agence France-Presse

We make it make sense

If this story helped you navigate your world, subscribe to the M&G today for just R30 for the first three months

Subscribers get access to all our best journalism, subscriber-only newsletters, events and a weekly cryptic crossword.”

Roland Jackson
Guest Author

Related stories

WELCOME TO YOUR M&G

Already a subscriber? Sign in here

Advertising

Latest stories

US conduct regarding Taiwan evinces a dangerous and ignorant strain...

It underestimates the role of face-saving, which is central to Chinese culture, and the country’s priorities, such as attaining the Chinese Dream

Eskom: Stage two load-shedding tonight

Continued blackouts highly likely on Wednesday and Thursday, the energy entity added

MPs dismiss Mkhwebane’s call to subpoena Ramaphosa

The president’s evidence is not necessary to determine whether she is guilty of misconduct, the section 194 committee concludes

Marikana: There should have been disciplinary proceeding, says Ian Farlam

The chair of the commission of inquiry says a personal apology from Cyril Ramaphosa would help families of the dead to heal
Advertising

press releases

Loading latest Press Releases…
×