HSBC is the latest addition to the group of eight FTSE 100 companies which have changed leader in 2024, with group chief executive Noel Quinn announcing his retirement today (30 April).
Quinn, who made the announcement as HSBC released its first quarter results, has held the position for the past five years. The board stated that it has began a review process of both internal and external candidates as his replacement, though the timeline is not yet clear.
See also: St James’s Place sees net inflows shrink while FUM grows in Q1 2024
“It has been a privilege to lead HSBC. I never imagined when I started 37 years ago that I would have the honour of becoming group chief executive of this great bank,” Quinn said.
“I am proud of what we have achieved, and it has only been possible because of the talent, dedication, and commitment of the people at HSBC. I want to thank them whole-heartedly and wish them continued success for the next stage of the journey. After an intense five years, it is now the right time for me to get a better balance between my personal and business life. I intend to pursue a portfolio career going forward.”
Alongside HSBC, other FTSE 100 firms to have seen a change in CEO so far this year include RELX, Next, Ocado, Experian and 3i.
In the first quarter, pre-tax profit for HSBC rose to $12.7bn, up from $977m in the last quarter of 2023. However, the number is still slightly down from last year’s first quarter pre-tax profits of $12.9bn.
Russ Mould, investment director at AJ Bell said in response to the results: “HSBC’s first-quarter pre-tax profit is slightly better than expectations and the bank’s declaration of a quarterly dividend and a special dividend will also please, even if they were well trailered, so chief executive Noel Quinn can argue the announcement of his plan to retire coincides with some good news.
“However, HSBC is no longer the most-highly valued of the FTSE 100’s megabanks, on the basis of price to net asset, or book, value, and it is now one of the cheapest on an earnings and yield basis, as the cloud cast by China’s economic outlook continues to linger.
HSBC has marginally been beaten by Lloyds and NatWest Group on price-to-book value in the first quarter of 2024. In forward earnings multiples for 2024, HSBC sits at 6.2, level with Standard Chartered, while Barclays edges ahead at 6.8 and Lloyds and NatWest Group step ahead at 8.4 and 8, respectively.
“Since Mr Quinn took the helm in August 2019, HSBC has had to navigate Covid-19, the very long lockdown in China and then handle the Middle Kingdom’s turgid post-pandemic economic recovery, which has been held back by the spectacular real estate bust,” Mould said.
“All of these factors have weighed upon the bank’s share price performance, even if analysts’ believe that HSBC will set new all-time highs for both annual profit and dividend payments in 2024.”
