Sept. 22 (Bloomberg) -- HSBC Holdings Plc, Europe’s largest bank, wouldn’t confirm or deny a report that Chief Executive Officer Michael Geoghegan threatened to resign if he wasn’t promoted to chairman.
Geoghegan made the threat as he was told the board wasn’t ready to appoint him to the post, the Financial Times reported today, citing two people familiar with the discussions. Paul Harris, a London-based spokesman for HSBC, said the bank won’t comment on “speculation.”
HSBC is looking for a chairman after Stephen Green resigned to take a job as trade minister for the U.K. The bank will probably appoint a successor at a board meeting in Shanghai before the end of the month, a person with knowledge of the situation said on Sept. 10. If the board decides not to promote Geoghegan, the most likely candidate to succeed Green is John Thornton, a former Goldman Sachs president who is chairman of HSBC’s North American division, the person said.
“If Geoghegan doesn’t get the job now, he might not get it at all and he would be very disappointed by that,” said Christopher Wheeler, an analyst at Mediobanca SpA in London who has a “buy” rating on the stock. “There is every possibility that he threatened to resign.”
HSBC fell 1 percent to 664.5 pence as of 10:05 a.m. in London, for a market value of 117 billion pounds ($183 billion). The shares have fallen 6.2 percent this year.
Geoghegan, 56, replaced Green as CEO in 2006. He moved to Hong Kong from London in February this year after working for the bank for more than 35 years. Thornton, 56, joined HSBC as a non-executive chairman of its North American unit in December 2008, six months after the division pushed the bank into the biggest writedowns in its history.
Should the board decide to name Hong Kong-based Geoghegan chairman, candidates to replace him include Asia CEO Sandy Flockhart and Stuart Gulliver, who runs HSBC’s investment bank, the person said on Sept. 10.
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