HSBC Resists Ping An-Backed Proposals at Annual Investor Meeting

HSBC faced and successfully thwarted proposals presented at its annual investor meeting in Birmingham, England, aimed at restructuring the bank and spinning off its profitable Asian business. The suggestions, submitted by individual investor Ken Lui based in Hong Kong and supported by major shareholder Ping An, sought a significant overhaul of the bank’s operations and an increase in dividends.

Approximately 80 percent of the votes cast at the meeting opposed both resolutions, with none of the other top 50 institutional investors supporting the proposed changes. Despite the defeat, Ping An intensified its opposition by voting against several other resolutions, including the re-election of HSBC’s chairman, Mark Tucker, and the pay report for top executives. Although these resolutions ultimately passed, they received about 20 percent of votes against, attributed to Ping An’s influence.

The prolonged campaign by Ping An to separate HSBC from its highly profitable Asia business has unfolded amid escalating geopolitical tensions between China and the West. A Ping An spokesperson stated that the company respected shareholders’ decisions but urged HSBC’s senior management to consider investor suggestions with an open mind to enhance company value.

John Cronin, a banking analyst at Goodbody, characterized the outcome as a resounding rejection by the majority of shareholders, with Ping An representing the sole voice advocating for a breakup. He suggested that while the proposal might be shelved for the time being, similar pressures could resurface under different market conditions.

Despite the setback, Ken Lui expressed his intention to persist in pressuring HSBC’s management. He plans to mobilize the bank’s vast Hong Kong retail shareholder base in support of his position. Lui had directly questioned HSBC’s board during the meeting, prompting Chairman Mark Tucker to defend the bank’s performance and emphasize that any breakup would undermine its global strategy and revenue.

With about a 50 percent turnout, Ping An’s shareholding, representing approximately 18-19 percent of the vote against the bank, fell short of the 75 percent required for success. HSBC reported a tripled profit in the first quarter, attributing it to rising interest rates and paid its first quarterly dividend since 2019.

Tucker also informed investors that HSBC still intends to sell its French retail business, with negotiations ongoing, despite warning last month that the deal could be in jeopardy. The investor meeting, similar to Barclays’ earlier in the week, saw disruptions from climate campaigners, with interruptions and protests urging the bank to take more substantial action against financing polluting companies and industries.

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