HSBC is facing increased pressure to split its Asian and Western operations, as the banks biggest shareholder, Chinese insurer Ping An, has called for the company to break-up, reports the Financial Times. The split would mark the end of a dual east-west focus that has been in place for over 100 years.
The rupture with Ping An, the biggest insurance group in China, marks a worsening of HSBC’s geopolitical woes, with the bank increasingly torn between China and the West. Ping An has set out its plan for the break-up to HSBC, which is led by chair Mark Tucker and chief executive Noel Quinn, according to people familiar with the matter.
Ping An has argued that an independent Asia business listed in Hong Kong would have higher profitability, lower capital requirements and greater autonomy to make decisions. A second top-10 shareholder told the Financial Times that Ping An’s proposal was a “pretty interesting idea,” adding: “For HSBC, it’s existential. They are not in a tenable structure. You wouldn’t create this institution from scratch.”