HSBC's Green steps down to be trade minister
HSBC chairman Stephen Green will step down to become trade minister for the UK government, as the race formally begins to succeed him.
The bank plans to name Mr Green's replacement by the end of this year, London-based HSBC said in a statement yesterday. Mr Green will take up his government job in January.
The lender "had already been working on the chairman's succession" and had appointed external advisers, HSBC said. "It was always the board's intention that it would be in a position to approve a successor to Green before the end of the year, and that timetable remains on schedule."
Mr Green (61) is leaving Europe's biggest bank as a UK government commission considers whether lenders should separate their consumer and investment banking divisions.
Barclays has named Bob Diamond, head of its investment banking arm, to replace John Varley as CEO next year.
HSBC "will be looking to balance out the board between having a British CEO and non-British chairman or vice versa," said Colin Mclean, who manages £650m (€783m) at SVM Asset Management in Edinburgh, including HSBC shares. CEO Michael Geoghegan, who is British, and former Goldman Sachs partner John Thornton are "viable" candidates to succeed Mr Green, Mr Mclean said.
Mr Thornton, who is based in New York, couldn't immediately be reached for comment.
Mr Geoghegan, who replaced Mr Green as CEO in 2006, issued a statement lauding his predecessor's contribution to the bank. "For HSBC it is business as usual; I continue to run the company," he said.
HSBC was little changed at 662.4p in London for a market value of £116.6bn.
Mr Thornton joined HSBC as a non-executive chairman of its North American unit in December 2008, six months after the division pushed the bank into the biggest writedowns in its history. The bank has since set aside more than $58bn (€46bn) to cover bad loans made by its subprime lender Household International, which it purchased in 2003.
Mr Thornton, a former Goldman Sachs banker and former chairman of its Asia unit, was elected in May to run HSBC's remuneration committee.
Mr Geoghegan has more than 35 years' experience with HSBC in roles all over the world and ran its South American unit from 1997 to 2003. He moved to Hong Kong from London in February this year and gained control of strategy as the bank focuses on emerging markets.
Mr Green, who joined HSBC in 1982, was CEO from 2003 until 2006 when he succeeded John Bond as chairman. He had a salary of £1.25m as chairman and did not receive a bonus. (Bloomberg)