HSBC appoints Brendan Nelson as chair

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HSBC has appointed former KPMG partner Brendan Nelson as its new chair just days after meeting external candidates, ending a chaotic search process that left the crucial role vacant for months.

The 76-year-old British executive, who has been interim chair since the start of October, was seen as a long shot for the position given his limited experience in Asia where the bank generates most of its profits.

HSBC has been rushing to find a suitable candidate for one of the most prominent and demanding roles in the industry after Sir Mark Tucker unexpectedly announced this year that he would leave the position much earlier than expected.

Tucker stepped down in September to become chair of Asian insurer AIA. He has been acting as an adviser to HSBC since then, according to people familiar with the matter.

HSBC’s failure to secure a high-profile external candidate with proven diplomatic skills to navigate competing interests in China and the US is likely to raise questions about the effectiveness of the board at one of London’s largest listed companies.

Nelson, a longtime executive at KPMG, has spent most of his career in the UK. He previously served as a non-executive director at BP and British lender NatWest.

HSBC’s board had set aside two days this week to speak with candidates, including former UK chancellor George Osborne and Goldman Sachs’ Asia boss Kevin Sneader, according to people familiar with the process.

The board picked Nelson after being divided on the other candidates’ suitability, they added.

While Nelson joined HSBC’s board in September 2023, he is unlikely to serve a full term as chair.

Before the announcement, HSBC’s chief executive Georges Elhedery told the Financial Times Global Banking Summit on Tuesday that Nelson did not want to serve a full term of six to nine years.

The former accountant would stay in the role “for as long as it takes until the board and the nomination committee identify the right chair”, Elhedery said.

HSBC said the decision was made after a “robust process” that looked at internal and external candidates.

“Since assuming the role of interim group chair, Brendan has demonstrated his excellent leadership capabilities backed by his strong banking and governance credentials,” said Ann Godbehere, the senior independent director who led the recruitment process.

While HSBC has its headquarters and primary listing in London, much of its profit and growth comes from Hong Kong and greater China, creating a challenge for its management.

In 2022, Chinese insurer Ping An, the bank’s largest shareholder, launched a public campaign calling for a break-up of HSBC along east-west lines.

Under Elhedery, the bank has sought to simplify its sprawling structure, announcing sales this year of some of its far-flung retail banking operations in countries such as Bahrain, Malta and Sri Lanka.

In October, HSBC also made a strategic step towards expansion, making a HK$106bn (US$13.6bn) offer to buy out minority investors in Hang Seng Bank, another Hong Kong lender — highlighting the need for strong, top-level leadership to deal with regulators and politicians.

“This is a multiyear commitment for a 76-year-old,” noted Alicia García-Herrero, chief Asia-Pacific economist at Natixis, a French bank. “I imagine he will continue to focus on expanding in Asia to the detriment of western operations.”