HSBC's top executives faced intense scrutiny from shareholders in Hong Kong on Monday as they defended their strategy and responded to calls for a breakup of the bank.
At an informal shareholder meeting, HSBC Chairman Mark Tucker and CEO Noel Quinn fielded questions from investors on various topics, including the bank's approach to addressing demands for an overhaul of its business. The board's recommendation is that shareholders vote against a resolution at the annual general meeting in May that would force the bank to come up with a plan to spin off or reorganize its Asian business.
Tucker stated that the board was unanimous in its opposition to the resolution, stating that "it would not be in your interest to split the bank." He also emphasized that the current strategy is working and dividends are moving upwards. However, this has only fueled frustration among some shareholders who believe that the London-based lender's performance in Asia has dragged down its overall business.
One such shareholder, Christine Fong, a district council member in Hong Kong, expressed concern about how HSBC's dividend cancellation would affect small investors like street hawkers, taxi drivers, and teachers. She claimed that these individuals rely on the dividend to pay for their regular expenses.
Meanwhile, activist shareholder Ken Lui has doubled down on his call for support ahead of the meeting, stating that "nothing is impossible" when it comes to pushing for a breakup. His group will focus on targeted outreach to institutional shareholders and canvassing 18 districts in Hong Kong to inform investors about the potential benefits of voting in favor of the proposal.
HSBC's largest shareholder, Ping An Insurance Group of China, has also backed calls for the bank to rethink its structure. The Chinese insurer holds an 8% stake in HSBC and has expressed support for any initiatives that could improve the bank's performance and value.
The acquisition of Silicon Valley Bank's UK arm by HSBC was another topic of discussion at the meeting. Critics have questioned whether the bank conducted adequate due diligence on SVB UK's customers before making the purchase, which was completed just days after the US parent company collapsed.
Quinn and Tucker defended the acquisition, arguing that it presented a good business opportunity to gain hundreds of innovative startups as customers. However, they acknowledged that there may be an "immediate impact" on HSBC's share prices due to recent turmoil in the banking industry.
At an informal shareholder meeting, HSBC Chairman Mark Tucker and CEO Noel Quinn fielded questions from investors on various topics, including the bank's approach to addressing demands for an overhaul of its business. The board's recommendation is that shareholders vote against a resolution at the annual general meeting in May that would force the bank to come up with a plan to spin off or reorganize its Asian business.
Tucker stated that the board was unanimous in its opposition to the resolution, stating that "it would not be in your interest to split the bank." He also emphasized that the current strategy is working and dividends are moving upwards. However, this has only fueled frustration among some shareholders who believe that the London-based lender's performance in Asia has dragged down its overall business.
One such shareholder, Christine Fong, a district council member in Hong Kong, expressed concern about how HSBC's dividend cancellation would affect small investors like street hawkers, taxi drivers, and teachers. She claimed that these individuals rely on the dividend to pay for their regular expenses.
Meanwhile, activist shareholder Ken Lui has doubled down on his call for support ahead of the meeting, stating that "nothing is impossible" when it comes to pushing for a breakup. His group will focus on targeted outreach to institutional shareholders and canvassing 18 districts in Hong Kong to inform investors about the potential benefits of voting in favor of the proposal.
HSBC's largest shareholder, Ping An Insurance Group of China, has also backed calls for the bank to rethink its structure. The Chinese insurer holds an 8% stake in HSBC and has expressed support for any initiatives that could improve the bank's performance and value.
The acquisition of Silicon Valley Bank's UK arm by HSBC was another topic of discussion at the meeting. Critics have questioned whether the bank conducted adequate due diligence on SVB UK's customers before making the purchase, which was completed just days after the US parent company collapsed.
Quinn and Tucker defended the acquisition, arguing that it presented a good business opportunity to gain hundreds of innovative startups as customers. However, they acknowledged that there may be an "immediate impact" on HSBC's share prices due to recent turmoil in the banking industry.
It's like, no one wants to split HSBC into two or three companies and start all over again. The board is right, it would be a huge headache and might not even make sense from an investment perspective. I'm with Ping An Insurance Group of China on this one - if the bank's performance is underwhelming in Asia, maybe it's time to rethink the strategy. And what's up with the acquisition of Silicon Valley Bank's UK arm? If the due diligence wasn't done properly, that's a whole different can of worms... 
. I mean, come on, shareholders are clearly not happy with the current strategy and yet they're still trying to convince us that splitting up the bank is a bad idea? 
. Small investors like street hawkers, taxi drivers, and teachers are already struggling to make ends meet, so cancelling their dividend payments is just cruel 
. And what's the supposed benefit of keeping everything under one umbrella? Is it really that hard to recognize when a part of your business is dragging you down? 
. But at the same time, Ken Lui's group thinks a breakup could be a good thing? Like, what's the reasoning behind that? And Ping An Insurance Group in China is backing them up, which is interesting 
.
It sounds like a lot of shareholders are questioning the bank's decisions and it's getting pretty heated at these meetings 
. I wish someone could explain what's going on in a way that makes sense to me... this all feels so confusing! 
. The idea that dividends could impact small investors like street hawkers and taxi drivers is a good point, though 
. We need to see what kind of answers the execs can come up with to quell these concerns 
.
The bank's CEO and chairman are trying to do their job, but everyone's being super dramatic about it. I get that the Asian business isn't performing well, but splitting the bank would be a huge deal and could hurt innocent people who rely on the dividends 
.
? Like, okay, buddy, try telling me that actually works 
. It's not that simple. The reality is, HSBC is in this mess because of global economic uncertainty and bad investments, not because the bank's leadership isn't doing their job 
. Is it better business opportunities? More shareholder value? Or are we just trying to make some noise and get attention? Let's focus on finding solutions, not just stirring up drama 
! I mean, who needs a massive bank with divisions all over the place? It's like trying to herd cats 
. And yeah, the Asian business has been dragging down the overall performance - that's just basic math 
. I'm also not buying (pun intended) on the whole "dividends are moving upwards" thing 
. They're literally living off the dividend 
! Ken Lui is on the right track with his activist group - we need more voices like him speaking up 
. And Ping An Insurance Group of China should be leading the charge, not just backing calls from others 
!
. Meanwhile, Ken Lui and his crew are all about spreading the word about how a breakup could be good for small investors in Hong Kong... like they're not already worried enough about those dividend payments