Business

HSBC axes CEO Flint after only 18 months in role to speed up growth

5 August 2019 - 65   - 0

HONG KONG/LONDON (Reuters) - HSBC  ousted Chief Executive Officer John Flint after just 18 months in that role, in a surprise move that the lender’s chairman said was necessary to accelerate progress of its strategic priorities.

Flint’s exit, which a person familiar with the matter said was a result of differences over execution of his strategy, was disclosed by HSBC early on Monday along with its half-yearly results which had been scheduled for release later in the day.

The departure comes as Europe’s biggest bank is grappling with headwinds including an escalation of a trade war between China and the United States, an easing monetary policy cycle, unrest in the key Hong Kong market and uncertainty about Brexit.

Flint, 51, ran HSBC’s retail and wealth management business before taking over as CEO in February 2018. His appointment was the first major decision taken by the bank’s first externally appointed chairman Mark Tucker, who came on board in late 2017.

Tucker told Reuters a change of CEO was needed to accelerate progress in HSBC’s major strategic priorities, such as the turnaround of its U.S. business.

“It’s the right time for change, and doing it clearly and decisively from a position of strength is very important,” Tucker said, adding that the search for a new CEO could take up to a year.

HSBC's Hong Kong shares fell 1.4% in afternoon trade, while the broader market .HSI was down 2.7%.

The stock dropped even as the lender posted a 16% rise in half-yearly profit and unveiled a buyback of up to $1 billion, defying some analysts’ expectations it might pause a strategy of returning extra capital to investors.

U.S. WOES

London-headquartered HSBC, which makes more than 80% of its profit in Asia, said that its global commercial banking unit head Noel Quinn will be interim chief executive. The board would consider internal and external candidates for the new CEO, it said.

A person familiar with the matter said Flint’s departure was a result of differences of opinion between Flint and Tucker over the pace and results of executing HSBC’s strategy.

The differences arose from Flint’s softer approach to cutting expenses and setting revenue targets for senior managers to boost profit growth, said the person, declining to be named due to the sensitivity of the issue.

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