AIG American International Group Inc

By Margot Patrick in London and Julie Steinberg in Hong Kong 

HSBC Holdings PLC named AIA Group Ltd. Chief Executive Mark Tucker as its next chairman, the first time the bank has hired an outsider for the role in its 152-year history.

Mr. Tucker will become chairman on Oct. 1, a month after coming aboard as a board member, HSBC said in a statement Sunday. He will succeed outgoing HSBC veteran Douglas Flint. Mr. Tucker, currently based in Hong Kong, will relocate to London.

Mr. Flint's departure is the first step in refreshing the bank's leadership team and setting out its next set of goals. Mr. Tucker will lead the process of identifying a successor to HSBC Chief Executive Stuart Gulliver, who has said he would leave once Mr. Flint's successor was in place. The bank said that process would conclude in 2018.

The Wall Street Journal earlier reported on the appointment of Mr. Tucker, citing people familiar with the matter.

Mr. Tucker has been at AIA since 2010. He joined the insurer as its former owner, American International Group Inc., readied it for an initial public offering in Hong Kong. Before AIA, Mr. Tucker was chief executive of Prudential PLC, building its Asian franchise in the 1990s, and has been a nonexecutive director at the Bank of England.

While at Prudential, Mr. Tucker and the board fought off a hostile takeover offer from rival Aviva PLC, saying Prudential was better off alone. The bid was ultimately dropped.

He is known in the region as a smart and measured hand, having helped AIA to grow since its IPO. Shares of AIA have more than doubled since the offering. Mr. Tucker will be replaced by Ng Keng Hooi, AIA's regional chief executive, the insurer said Monday.

Along with resigning from AIA, Mr. Tucker will also step down from the board of Goldman Sachs Group Inc., HSBC said. He will receive annual compensation of GBP1.5 million ($1.8 million), benefits and a relocation amount of GBP300,000.

Mr. Flint, alongside Mr. Gulliver, helped HSBC reshape itself and adapt to harsher regulation and lower profitability for banks after the financial crisis. Their five-year strategy plan in 2011 saw the bank rein in its sprawling global operations, closing dozens of business and exiting from much of Latin America.

After HSBC paid $1.9 billion in a 2012 settlement over money-laundering lapses, Mr. Flint and Mr. Gulliver oversaw a costly effort to raise financial crime-fighting standards at the bank, which is still subject to a deferred-prosecution agreement that was part of the settlement.

The two men were seen by analysts and investors as a formidable duo, with Mr. Flint becoming a top voice in bank regulation circles, and Mr. Gulliver credited with managing the bank's risks with the eye of the trader he once was. But some investors had urged the bank not to let Mr. Flint and Mr. Gulliver linger too long, and last year they clarified their plans to leave.

Mr. Flint became chairman in December 2010 and has been on HSBC's board since 1995, the year he joined the bank as finance director. Mr. Gulliver, at the bank since 1980, became CEO at the start of 2011.

Since starting in Hong Kong in 1865, HSBC has always selected insiders as chairman, even when it meant falling afoul of U.K. corporate-governance recommendations. It had said that this time around it would bring in an outsider.

Corrections & Amplifications HSBC Holdings PLC is set to name AIA Group Ltd. Chief Executive Mark Tucker as its next chairman, the first time the bank has hired from outside for the role in its 152-year history. An earlier version of this article incorrectly stated the age of the company. Also, the photo caption incorrectly spelled the name of Mark Tucker. (March 12)

Write to Margot Patrick at margot.patrick@wsj.com and Julie Steinberg at julie.steinberg@wsj.com

(END) Dow Jones Newswires

March 13, 2017 02:47 ET (06:47 GMT)

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