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HSBC management claims victory as Ping An finds little support for pro-breakup resolution

HSBC  shareholders roundly rejected Ping An’s split plan (Matt Crossick/PA) (PA Archive)
HSBC shareholders roundly rejected Ping An’s split plan (Matt Crossick/PA) (PA Archive)

Insurance group and activist HSBC investor Ping An found few allies in its plan to force a breakup of the London-headquartered banking giant, with more than 80% of shareholders voting against a pro-split proposal.

Ping An has repeatedly called for HSBC’s Asian arm to be spun off, but the company’s management has argued that this would not represent the best value for shareholders. Both the insurance business and HSBC chair Mark Tucker lobbied shareholders to vote with them ahead of today’s meeting in Birmingham.

Ultimately, only 19.8% of voting shares were cast in favour of the proposal to review HSBC’s strategy and provide regular updates on the aims of its Asian business, in order to prepare for a potential split. The lender’s board noted that Ping An represented between 18% and 19% of voting shares at the meeting, which would mean it gained little support otherwise.

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Tucker claimed victory after the bank’s AGM, which was also disrupted by climate protestors. He said it was time to “draw a line under” the debate.

“I’m delighted that the large majority of HSBC’s shareholders have voted overwhelmingly to support the bank’s strategy and draw a line under the debate on the structure of the bank,” he said. “The board, HSBC colleagues and our shareholders can now move forward with the shared objective of focusing on our customers, driving stronger performance, and creating more value for our investors.”

Just over 20% of votes were cast against HSBC’s director pay policy, with the vast majority of these also coming from Ping An.

Before the AGM, Tucker urged shareholders to reject Ping An’s resolutions.

“Our current strategy is working,” Tucker said in his speech to open the event. “It is improving our performance and increasing your dividends. You should not put this at risk.

“We respect the views and opinions of our shareholders. But we would only ever pursue suggestions if they offered material net benefits for all our shareholders. It is our unanimous view that these resolutions do not do that.

“The Board has a clear responsibility to protect and grow shareholder value. And the best way to do that is to continue with our current strategy.”