HSBC lines up former Prudential chief Tucker as next chairman

(c) Sky News 2017: <a href="http://news.sky.com/story/hsbc-lines-up-former-prudential-chief-tucker-as-next-chairman-10797825">HSBC lines up former Prudential chief Tucker as next chairman</a>
 

HSBC Holdings (Frankfurt: 923893 - news) , Europe's biggest bank, is lining up the former Prudential (SES: K6S.SI - news) chief executive Mark Tucker as its next chairman - a move that will have far-reaching implications for some of the world's biggest financial services groups.

Sky News can reveal that HSBC has approached Mr Tucker about replacing Douglas Flint in one of the biggest jobs in global banking.

Talks between HSBC and Mr Tucker, the chief executive and president of AIA (HKSE: 1299-OL.HK - news) , Asia's biggest life insurance company, are said to be ongoing.

If they result in his appointment as Mr Flint's successor, it would‎ be a significant moment in the history of HSBC, which has never previously appointed an external chairman.

The Sunday Times revealed in 2015 that the bank, which has a market value of £132.3bn, would recruit from outside its executive ranks for the first time.

Regulators in London and Hong Kong are said to have been notified of the discussions about his prospective appointment, but people close to the talks cautioned this weekend that no deal had been done, and that the negotiations could still fall apart.

Goldman Sachs (NYSE: GS-PB - news) would also feel the effect of Mr Tucker's appointment, as he would probably have to relinquish the non-executive directorship he took on in 2012 if he became HSBC's next chairman.

Mr Tucker would arrive at HSBC with an impressive pedigree in the Asian stronghold of the bank‎ - founded more than 150 years ago as the Hongkong and Shanghai Banking Corporation.

He joined AIA in 2010 following a failed $35bn takeover bid for ‎the company by his former employer, Prudential.

The Asian company now has a market value of HK$606bn, or more than £64bn.

Mr Tucker had also sought to buy AIA while he was running the Pru (HKSE: 2378-OL.HK - news) , but stepped down from the FTSE-100 insurance group in 2009.

He is also a former director of the Court of the Bank of England and one-time finance director of HBOS, long before it ran into the troubles that led to its rescue by Lloyds TSB during the ‎2008 banking crisis.

Regulators would probably insist that Mr Tucker relocates himself to the UK as a condition of approving his appointment, which would come little more than a year after HSBC concluded a lengthy review of its domicile by deciding to remain headquartered in London.

The search for a successor to Mr Flint has been underway since last year, with the initial favourite considered to be Henri de Castries, the former boss of AXA (Paris: FR0000120628 - news) , the French insurer.

Mr de Castries, who is ‎already on HSBC's board, has made no secret of his political ambitions in France, with elections to be held in May, and formally withdrew from the bank's appointment process some weeks ago.

If the appointment of Mr Tucker did fall through, existing non-executives Jon Symonds and David Nish could emerge as ‎contenders to replace Mr Flint.

Announcing annual profits last month of $7.1bn (£5.8bn), HSBC said it had no shortlist for the chairman's job, which one shareholder interpreted as meaning it had already identified Mr Tucker for the role.

Leading investors in HSBC have urged the bank not to rush a succession process, with its shares up by almost 50% over the last year.

Its 2016 results were impacted by a series of one-off charges, including a $3bn writedown of goodwill related to its Swiss private bank.

Among the challenges for the bank's next chairman‎ will be identifying a long-term successor to Stuart Gulliver, its chief executive since 2011, who has led a sweeping restructuring programme aimed at driving up returns to investors.

Mr Gulliver has sold dozens of underperforming businesses, as well as many more which posed a reputational and financial crime risk to HSBC.

He continues to have overwhelming support from the bank's ‎biggest shareholders, and is unlikely to step down until late 2018 at the earliest.

If Mr Tucker's appointment does take place, it would contrast with the chaotic succession process in 2010 triggered by Lord - then Stephen - Green's departure to become David Cameron's trade minister.

Mr Flint, the long-serving finance director, was promoted to the chairmanship, with Mr Gulliver taking over from Michael Geoghegan as chief executive - but only after bouts of boardroom in-fighting ‎had been publicly exposed.

HSBC declined to comment on Saturday (Shenzhen: 002291.SZ - news) , while Mr Tucker could not be reached for comment.

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