Born in Asia but Based in Britain, HSBC Fights to Stay in One Piece (2024)

For many investors, HSBC, Europe’s largest lender with a venerable place in Britain’s banking industry, offers little to critique: It is performing well and has focused on its most profitable and fastest-growing operations, those in Asia.

But for the firm’s largest investor, the sprawling Chinese insurance giant Ping An, that isn’t enough.

Over the past year, Ping An has waged a campaign to convince HSBC to spin off its Hong Kong-based operations in some way, cracking open the bank’s global empire to improve its financial performance. It’s a move that HSBC’s board has strongly resisted as costly and ineffective.

The clash will come to a head at HSBC’s annual shareholder meeting in the English city of Birmingham on Friday, where investors will vote on two proposals backed by Ping An, including one that would push the bank to regularly consider revamping its global structure.

Those initiatives face long odds, even with Ping An owning an 8 percent stake. Influential investor advisory firms oppose the measures, and HSBC’s latest financial results were strong, reporting earnings that greatly exceeded expectations. But Ping An, which first invested in HSBC in 2017, has shown little inclination to walk away.

From its founding in 1865 in Hong Kong, HSBC was meant to bridge east and west. Since then, it has moved its headquarters to Britain and expanded its financial reach worldwide, with nearly $3 trillion in assets putting it in the top 10 largest global banks.