HSBC shakes up leadership team following CEO appointment

HSBC has disclosed that the head of its wealth unit, chief operating officer and head of human resources are leaving the bank in the first major management shake-up since Georges Elhedery was named as chief executive last month.

Nuno Matos, the bank’s head of wealth and personal banking, who was a leading contender for the chief executive role, is departing after nine years, HSBC said in a statement on Thursday. He will be succeeded by Barry O’Byrne, currently head of global commercial banking, who will remain based in Hong Kong. 

Matos, who joined HSBC in 2015 from Santander, was instrumental in driving cost controls and overseeing the bank’s lucrative wealth division, which now accounts for around 38 per cent of the bank’s pre-tax profit, according to its 2024 half-year results. 

Additionally, chief operating officer John Hinshaw and human resources chief Elaine Arden are also departing. Hinshaw’s role will be split between Stuart Riley, who will become chief information officer, and Suzy White, who will handle other COO duties on an interim basis. Aileen Taylor, currently company secretary and chief governance officer, will replace Arden.

Read more: https://www.thebanker.com/HSBC-appoints-Elhedery-as-CEO-to-continue-bank-s-Asia-focus-1721216942

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The UK’s Prudential Regulation Authority is likely to delay implementing the Basel 3.1 bank capital reforms until at least January 2026, according to a Bloomberg News report on Thursday citing anonymous sources familiar with the matter. 

The delay is partly due to the UK±s general election, which imposed a “quiet period” on regulators, preventing them from issuing detailed rules with sufficient notice for banks, the sources said. 

The postponement also provides the PRA with an opportunity to monitor developments in the US, where Basel III Endgame proposals have sparked political controversy and potential legal challenges from banks.

In a response to signs that US regulators would likely miss their July 2025 deadline for implementing the Basel Endgame rules, the EU announced in June that it would delay a key portion of its Basel package until January 2026, so that its banks will not be at a disadvantage compared with their US counterparts. 

The PRA plans to release a set of near-final Basel 3.1 rules on September 12. The rules are expected to reduce bank profitability while raising capital requirements, fuelling concerns within the industry about a decline in the sector’s competitiveness and contribution to the UK’s economy.

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Some Russian companies are experiencing significant delays and rising costs in transactions with their Chinese trading partners, holding up payments worth billions of yuan, according to a Reuters report on Friday, citing anonymous Russian sources with direct knowledge of the matter. 

The issues have intensified as Chinese banks tighten compliance following western threats of secondary sanctions for dealings with Russia. A source close to the Russian government told Reuters that Chinese state banks are “shutting down transactions with Russia en masse”.

While major bilateral trade between the two countries continues, smaller companies trading consumer goods are facing severe disruptions, with transaction costs rising to 6 per cent from close to zero previously, one of the sources said.

“With such volumes and in such an unfriendly environment, it is impossible to avoid some problematic situations,” Kremlin spokesman Dmitry Peskov said in a statement to Reuters.

Despite the challenges facing smaller Russian companies, Russia-China trade grew by 1.6 per cent to $137bn in the first half of 2024, according to official Chinese data. However, the data also revealed that due to the payments issues, Russia’s imports from China fell by more than 1 per cent during the same period. 

Read more: https://www.thebanker.com/Smaller-Chinese-banks-at-risk-from-US-secondary-sanctions-on-Russia-warn-experts-1720435980

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A lawsuit was filed by the American Sustainable Business Council against the state of Texas on Thursday, challenging a 2021 law that penalises businesses supporting reduced fossil fuel reliance.

Representing around 200,000 US businesses, the ASBC argues that Senate Bill 13, which prohibits Texas from investing in or contracting with companies accused of “boycotting” the oil and gas industry, infringes on free speech rights.

The lawsuit, filed in Austin federal court, names Attorney General Ken Paxton and Comptroller Glenn Hegar as defendants. In a statement, Hegar dismissed the lawsuit as a “frivolous” attack on Texas’s economic interests, while Paxton’s office has yet to comment.

The law has already led to Texas divesting $8.5bn from BlackRock and blacklisting other companies with ESG policies, including major European banks HSBC, UBS, BNP Paribas and Natwest. The ASBC claims the law harms its members and undermines Texas’s reputation as a business-friendly state.