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There is something dysfunctional about management and continuity at HSBC.
Chief executive Noel Quinn, having spent seven months auditioning for the top job, has decided to quit after less than five years at the helm.
Contrast this with the record of rival global banks. At JP Morgan, Jamie Dimon has been at the top since 2006, Brian Moynihan at Bank of America since 2008 and Bill Winters at Asian rival Standard Chartered since 2018.
Quinn wants a personal break from the top job at the £131billion lender, having taken a hatchet to a previous strategy of being the world’s local bank.
Gone are branch networks in France, Canada, the US and Argentina. Ambition is focused on core operations in Hong Kong and China. HSBC in the UK, essentially the old Midland Bank, has relocated to Birmingham.
Stepping down: HSBC chief exec Noel Quinn (pictured) has decided to quit after less than five years at the helm
The strategy has worked. The share price is 15 per cent higher than when Quinn took over.
The shares trade at a premium of 60 per cent to StanChart which does some of the same stuff.
Aside from traditional banking, HSBC has vast investment banking and trade operations serving Asia. It has almost central bank status in Hong Kong where it is the main conduit between the region and New York.
Doubling down on China pre-Covid looked clever. Except since then, China’s growth rate has halved, the property sector has subsided and suspicion of Beijing’s strategic goals has sparked what amounts to a US-China trade war.
None of this is likely to disturb anyone’s sleep at HSBC’s monumental headquarters in Hong Kong.
The bank has survived through the opium wars of the mid-19th century, the Mao revolution and found opportunity under the capitalist renaissance begun by Deng Xiaoping.
There is a mismatch between this history of surviving the tumult in the region, including the more recent security clampdown in Hong Kong, and recent leadership at HSBC.
Since Mark Tucker took over as chairman, it now faces a third change of leadership. Finance director George Elhedery and Nuno Matos, who runs retail banking and wealth, are seen as possible successors to Quinn.
Given that he made his desire to leave known at the turn of the year, it is extraordinary that the board does not have a successor in place.
Quinn kept 8 per cent Chinese-controlled shareholder Ping An, which wants a break-up of the bank, at bay. His premature departure does not signal stability.
Copper bottomed
Anglo American chairman Stuart Chambers has a titanic task. BHP has opened the door to a takeover but the Aussie bid is unlikely to be the final word. Chambers rightly is consulting shareholders.
An imaginative solution for the London miner would be to determine its own future by spinning out under-performing assets and doubling down on copper without betraying its South African heritage.
As it stands, BHP’s bid is unattractive. It has also irritated the South African authorities which have never forgiven BHP for previous spin-offs.
Other players, including cash rich Rio Tinto and experienced deal makers Glencore, will be watching closely.
Copper is the world’s most wanted commodity and the price at $10,155 per tonne is at a two-year high.
Glencore is at the forefront of mining metals for use in a zero-carbon economy. It is 44 per cent part owner of the Collahuasi high altitude mine in Chile in which Anglo American has a matching stake.
So it has more than a passing interest in what happens next. It is a major producer of cobalt and nickel, which are key to electric vehicles.
Glencore’s latest projection, amid strong income at its trading arm, is underlying earnings of £2.4billion to £2.8billion this year. It is not short of firepower.
Good game
The importance of supporting Britain’s video games industry was highlighted during Microsoft’s battle for Activision Blizzard last year.
Gaming employs 25,000 creators in the UK and contributes £3.7billion to GDP.
Industry body TIGA is urging the next government to put it on an equal footing with the movies with an Independent Tax Games Credit and an accelerator programme to support early stage developers. Makes sense.
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