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HSBC Confronts Protests Over Strategy and Climate at Annual Meeting

On Friday, HSBC faced opposition to its strategy and climate policy at a contentious annual investor meeting in Birmingham, England. A shareholder proposal to spin off its profitable Asia business, supported by major investor Ping An, was among the issues discussed.

HSBC building
HSBC building

Proposal to Spinoff Asia Business Faces Uphill Battle

Europe's largest bank is expected to defeat a proposal submitted by Hong Kong-based individual investor Ken Lui and backed by its largest Asian shareholder Ping An. The proposal calls for the lender to consider spinning off its Asia business. Shareholder Lui questioned HSBC's board directly, but the bank's chairman Mark Tucker countered that the criticism showed "a fundamental misunderstanding of HSBC's business." To succeed, the proposal requires 75% of the votes cast.

Resolutions Aim to Boost Dividends and Review Strategy

The proposed resolutions call for HSBC to increase dividend payouts and regularly review its strategy, including the possibility of separating its Asia business, which generates most of the bank's profit. Tucker argued that breaking up the bank would undermine its global strategy and hurt revenue, making it risky and costly.

Climate Campaigners Disrupt HSBC's Annual Meeting

Climate campaigners singing songs and displaying banners interrupted HSBC's investor meeting. This follows a similar protest at Barclays' annual meeting earlier this week. Major banks have been targeted by green campaigners who argue that lenders have not done enough to limit the financing of polluting companies and industries.

Institutional Investors Support HSBC's Board

No other major institutional investors have signaled support for the Asia spinoff. On the contrary, Norway's state investment fund, HSBC's fourth-largest investor, backed up the bank's board. Proxy advisory firms Glass Lewis and ISS have also recommended supporting the bank.

HSBC Q1 Profits Triple, French Retail Business Sale Ongoing

HSBC tripled its profit in Q1 as rising interest rates boosted income, resulting in its first quarterly dividend since 2019. Chairman Tucker also informed investors that the bank is still planning to sell its French retail business, with negotiations for sale ongoing.