On October 22nd, HSBC made a major overhaul by combining some of its investment banking and commercial operations under the reign of a new CEO. Additionally, Pam Kaur was appointed the first female Chief Financial Officer and will take on the CFO position from January 1st.
CEO Georges Elhedery said in a memo to staff, “A new leadership structure, including the appointment of Pam Kaur as the lender’s first female chief financial officer, would unleash our full potential and drive success into the future.”
Pam Kaur Takes the Helm: HSBC’s New Female CFO
Pam Kaur is a veteran in the banking sector, with a career spanning nearly four decades with various global lenders. In 2013, Kaur joined HSBC as an internal audit head soon after the bank admitted the money laundering and sanctions violations and had a prosecution agreement with the US Judicial system.
Pam Kaur will be taking charge as Chief Financial Officer from January 2025. After the official announcement, she became one of the most senior women in the Banking sector in Europe. Kaur will be onboarding during difficult times as interest rates have been falling amid geopolitical concerns in China and Hong Kong. Kaur’s experience of more than a decade in a group executive committee at HSBC will help her transform the bank.
She will receive an annual base salary of £803,000 ($1.04 million), a fixed pay allowance of £1,085,000, and a pension allowance of £80,300. Kaur is also eligible for an annual incentive award of up to 215% of the base salary and a long-term incentive of up to 300% of the base salary.
HSBC’s Strategic Business Overhaul
HSBC announced strategic plans to reduce the duplication of processes and decision-making.
On October 22, the bank shares were flat in early London trade while the U.K.-listed stock has risen over 6% year-to-date. Chinese insurer Ping An is the largest shareholder of HSBC with over a 9% stake. The insurer previously advocated for the separation of HSBC’s Asian business from the rest of the group’s operations. The initiative was rejected at last year’s annual general meeting.
Starting January 1, 2025, the bank will operate from four divisions, Hong Kong, UK, international wealth and premiere banking, and corporate and international banking. The bank’s new corporate and institutional banking unit will integrate its commercial banking operations (excluding Hong Kong and the U.K.), global banking and markets division, and wholesale banking activities in Western markets.
The analysts have claimed that the bank’s decision to operate from four divisions was “unknown and important.” The Financial Times has reported that Elhedery has been focusing on the bank’s senior management as part of cost-cutting measures that can save up to $300 million.
HSBC has been changing the bank’s management for several months as it plans to implement cost-cutting measures globally. The decision to operate from four different zones will align staff and the bank will be able to cut the exceptional cost.
