In a recent meeting with HSBC’s shareholders in Hong Kong, Chairman Mark Tucker made it clear that a spin-off of the bank’s Asian business is off the table.
Addressing shareholders’ inquiries, Tucker emphasized, “There is no appetite amongst our shareholder base, as demonstrated by last year’s AGM results, to vote for a spinoff.
“That will not happen.”
This statement comes after a proposal last year, supported by Hong Kong shareholders and major investor Ping An, for HSBC to consider separating its profitable Asia segment was overwhelmingly defeated.
The rejection of the spin-off proposal highlights the support the current board and the organizational structure of the bank have from its majority of institutional and retail investors.
HSBC, a leading global financial institution, reported a significant increase in its 2023 pretax profits, which surged by 78% to reach $30.3 billion.
Despite this impressive growth, the results fell short of the expected consensus estimate of $34.1 billion.
This shortfall was largely attributed to a $3 billion impairment related to the bank’s investment in China’s Bank of Communications.
Alongside the financial results, HSBC announced several shareholder returns, including a new $2 billion buyback scheme, an annual dividend payout of $0.61 per share, and plans for a special dividend of $0.21 per share following the completion of its Canada business sale.
These moves are part of HSBC’s broader strategy to enhance shareholder value and reinforce its commitment to its diversified global business model, despite the challenges and market speculations about restructuring and spin-offs.