Unlock Editor’s Digest for free
FT editor Roula Khalaf picks her favorite stories in this week’s newsletter.
HSBC has appointed Georges Elhedery as chief executive, giving the insider the task of steering the bank through escalating tensions between the West and China.
Elhedery, who joined the bank in 2005 and has been chief financial officer since early 2023, will replace Noel Quinn on September 2, HSBC said on Wednesday.
Quinn surprised investors in April by announcing he would step down after nearly five years in the role, a decision that left Elhedery as the front-runner.
His rise to the top job marks a remarkable rise that puts him at the helm of a financial institution particularly exposed to tensions between the West and China.
While headquartered in London, HSBC has deep ties to Hong Kong, maintaining a significant shareholder base there and accounting for the lion’s share of its profits in Asia.
The need to overcome geopolitical tensions has defined much of Quinn’s tenure, including fending off a challenge by Ping An, the Chinese insurance group and HSBC’s largest shareholder, to break up the bank.
Elhedery, 50, will also take on the role at a time when the boost to HSBC’s bottom line from higher interest rates begins to wane.
HSBC looked at internal and external candidates, but the search quickly narrowed to a race between Elhedery and Nuno Matos, who heads the bank’s global wealth and personal banking.
Announcing the appointment, HSBC chairman Sir Mark Tucker said Elhedery “is an exceptional leader and banker who cares passionately about the bank, our customers and our people.
“He has experience leading change, driving growth, bringing simplification, reducing costs and a strong focus on execution.”
Elhedera’s promotion followed a “proper and robust” succession process, the bank said.
The Lebanese-born leader will have to work closely with Tucker, who has built a reputation for a hands-on approach as chairman.
Elhedery is the third CEO appointed after Tucker, whose own nine-year term as chairman ends in 2026, although an extension may be granted in certain circumstances.
“Elhedery was the clear favorite after being named CFO to give him more visibility at corporate headquarters and with investors,” said Samuel Johar, chairman of advisory group Buchanan Harvey.
Under Quinn, HSBC began to divest some of its global operations and strengthened its focus on Asia. He also embarked on a sweeping restructuring, cutting 35,000 jobs and pledging to cut $4.5 billion in annual costs.
HSBC was among the biggest winners as central banks raised interest rates to help reduce inflation. That helped push the bank’s shares near a six-year high.
Shares of the London-listed bank were flat in early trading on Wednesday.
HSBC said Elhedery will receive a basic salary of £1.38m and a pension allowance of 10 per cent of that amount.
He will be entitled to an annual incentive award worth up to 215 percent of his base salary and a long-term incentive award up to a maximum of 320 percent of his base salary. Quinn earned £10.6m last year.
“I am deeply honored by the trust placed in me to lead this great institution into the future,” Elhedery said in a statement. HSBC said it would appoint a new finance chief to replace Elhedery “in due course”.
Tucker thanked Quinn, who initially took over in 2019 on an interim basis after his predecessor John Flint was ousted after just 18 months in the role, “for his loyal commitment to the group over 37 years”.
Another report by Emma Dunkley in London