HSBC Accelerates Strategy to Resist Break-up Call

HSBC is reportedly prepared to defend against Ping An’s proposal to break up the bank, with plans to announce a further acceleration of its strategy to shift resources to Asia.

HSBC will defend against Ping An’s proposal to explore strategic options like a spinoff of the Asia business, according to a report citing unnamed sources.

The British lender will argue in the upcoming earnings announcement on August 1 that the bank’s future is dependent on its global network of clients and services. HSBC will also outline its plan to accelerate its strategy to exit non-core businesses and further the shift towards Asia.

This follows travel by HSBC CEO Noel Quinn to Hong Kong a few days ago to undergo a seven-day hotel quarantine followed by a board meeting in the regional office.

On exiting non-core markets, the report highlights the possibility of business departures from more unprofitable clients in markets like France and Germany. The bank could also accelerate its exit from Turkey, Armenia, Greece and Oman where it is in talks to merge the latter business with local lender Sohar International Bank.

During the earnings announcement next month, the bank may not mention Ping An by name or allude to the breakup calls.

HSBC announced in February last year that the bank would commit 50 percent of capital allocation to Asia in the medium to long-term, up from 42 percent at the time.