SUPERNEWS

Equities

Ping An Cuts HSBC Stake to 7.98%, Votes Against CEO

Ping An sells $50 million of HSBC shares, reducing stake to 7.98%, after voting against CEO Noel Quinn's reappointment.

By Alex P. Chase

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5/10, 07:14 EDT
HSBC Holdings, plc.
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Key Takeaway

  • Ping An Insurance sold $50.1 million of HSBC shares, reducing its stake to 7.98%, after voting against CEO Noel Quinn's reappointment.
  • Despite the sale, Ping An views HSBC as a long-term investment, emphasizing the bank's competitive advantage in Asia.
  • The share sale and protest vote reflect Ping An's dissatisfaction with HSBC's strategic direction and leadership dynamics.

Share Sale After Vote Against CEO

Ping An Insurance Group Co., a major shareholder in HSBC Holdings Plc, sold approximately 0.4% of its HSBC shares shortly after voting against the reappointment of the bank's departing Chief Executive Officer, Noel Quinn, as a director. The sale involved 5.65 million shares, valued at HK$391.5 million ($50.1 million), reducing Ping An's stake from 8.01% to 7.98%. Despite this reduction, Ping An remains one of HSBC's largest shareholders, with its stake valued at £10.5 billion ($13.2 billion).

Long-Term Investment Strategy

Ping An has expressed its confidence in HSBC's long-term development, citing the bank's "unique competitive advantage in Asia." The insurer's statement emphasized its view of HSBC as a long-term financial investment. This stance comes despite Ping An's recent actions suggesting dissatisfaction with the bank's strategic direction, including a push for HSBC to spin off its Asian arm—a proposal that was defeated at a shareholder meeting last year.

Protest Vote Against Leadership

The decision to sell a portion of its HSBC shares followed Ping An's protest vote against Noel Quinn's leadership at the bank's shareholder meeting. This vote was cast days after Quinn announced his retirement, surprising the business world. The vote against Quinn's reappointment as a director indicated Ping An's ongoing concerns about HSBC's strategic direction. It was the first time Ping An disclosed selling HSBC stock since beginning its campaign for strategic changes at the bank.

Management and Shareholder Dynamics

HSBC, in response to the vote and share sale, stated that Quinn and the board were entirely unaware of Ping An's intention to vote against his director role until after the announcement of his retirement. This situation highlights the complex dynamics between HSBC's management and its shareholders, particularly regarding the bank's strategic decisions and leadership.

Management Quotes

  • Ping An:

    "HSBC is our long term financial investment. The bank has maintained unique competitive advantage in Asia. We are confident of its long-term development."