HSBC says John Flint out as CEO after 18 months

HSBC CEO John Flint

Flint won praise internally for his efforts to make HSBC a happier place to work, the executives said, citing his focus on his "healthiest human system" initiative created to improve work-life balance, workforce diversity and pay disparity.

The exact amount Mr Flint will get as a payoff remains unknown until he leaves the business, HSBC said. Tucker insists that the hunt for the next CEO is on and both internal and external candidates are being considered.

They clashed over style - with Mr Flint focused on issues such as conduct and Mr Tucker taking a more data-driven approach - and priorities, as Mr Flint failed to address the slow-growth USA business, say people familiar with the matter.

The news caught the market by surprise as it came along with the happy news that the London-based bank, which considers Hong Kong and mainland China as the top income contributors, saw a 16 percent increase in its interim profit.

HSBC's pretax profit for the first six months of 2019 rose to $12.41 billion from $10.71 billion in the same period a year earlier, helped by a surge in retail banking and Asia revenues.

Flint's departure was revealed as HSBC said it was facing an "increasingly complex and challenging global environment".

"Finance director Ewen Stevenson in an interview said the job cuts, which will be targeted at senior roles, would shave up to 4% off HSBC's wage costs and would come from a mix of layoffs and attrition as people leave for other jobs".

One of the main differences was related to efforts to turn around its under-performing United States business, the person said.

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Global commercial banking unit head Noel Quinn will be interim CEO.

"Our sense is the climate is getting increasingly complex, increasingly challenging, and that we both agree a change is needed to really make the most of the opportunities ahead of us", Tucker said in an interview yesterday.

HSBC said it no longer expects to achieve the targeted 6% return on tangible equity (ROE) by 2020 in the USA, where it has struggled for years to build scale and compete. Asia accounts for 80 per cent of HSBC's profits.

Global banks are struggling with low to negative rates, trade tensions slowing growth and disruptions from automation. "Given the prevailing outlook for interest rates and revenue headwinds in global banking & markets (GB&M) and retail banking and wealth management, we do not expect to achieve our 6% return on tangible equity (RoTE) target in the U.S. by 2020", the bank said.

Flint said it had been a privilege to spend his "entire career with HSBC" and that he was "proud of what we achieved together".

HSBC posted its results on a day when Hong Kong, its second home, was plunged into fresh chaos due to a general strike, as protests against an extradition bill evolved into a broader backlash against the government.

The lender on Monday added that it planned a buyback of HSBC shares worth up to $1 billion.

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