By Margot Patrick 

John Flint hoped to be remembered for an expansion of HSBC Holdings PLC into China, surging profits and making the bank a nicer place to work.

Instead, his ouster as chief executive after 18 months -- and a 30-year career with the bank -- may mark a break with the lender's colonial past and an attempt to shed its bureaucratic image.

HSBC late on Sunday said it was parting ways with Mr. Flint, a decision it said was reached by mutual agreement. The move came after months of concern over Mr. Flint's leadership style and ability to take decisive action, people familiar with the bank said. He was formally dismissed at a London board meeting Sunday, the people said.

Chairman Mark Tucker said Monday that "a change was needed" to put HSBC out in front of a variety of economic and geopolitical challenges, including the U.S.-China trade tensions and Britain's pending exit from the European Union.

The quietly-spoken Mr. Flint was "the best decision" when he was selected by the bank's board 18 months ago, Mr. Tucker said. But "we believe the environment we're going into needs a different person to take that forward."

Mr. Flint's temporary replacement, head of global commercial banking Noel Quinn, "brings pace, decisiveness and ambition," he said.

The bank will look inside and outside the bank for Mr. Flint's permanent replacement, Mr. Tucker said.

The ouster makes Mr. Flint's replacement "more likely to be external," said Russell Quelch, financials analyst at equity broker Redburn -- potentially breaking with a 153-year-old tradition.

Mr. Flint reached the unceremonious end of his career at a Sunday session with lawyers and the bank's board to work out the details of his departure. He wasn't immediately available for comment Monday.

While still in high school, Mr. Flint learned about HSBC's international officer program, a fast track into management that HSBC has likened to creating "DNA carriers" who can be deployed as needed into any of the dozens of countries where the bank operates. He joined the program in 1989 fresh out of college, and soon learned the ropes at the bank in retail branches and trading floors across Asia, Europe and the U.S.

Stuart Gulliver -- the CEO that Mr. Flint replaced and who retired from HSBC in February 2018 -- was an early mentor and also a product of the international officers program. Mr. Flint emerged early on as a likely replacement for Mr. Gulliver during the bank's CEO search. He was considered a safe choice as Mr. Tucker had just become the first-ever chairman appointed from outside the bank.

Before getting the job, Mr. Flint told colleagues he preferred not to be in the public eye, and would become CEO out of a sense of duty rather than because he woke up each day wanting it, according to people familiar with the comments.

In contrast to Mr. Gulliver's more rousing approach to leadership, demonstrated by an outward confidence and sharp grasp of the bank's inner financial workings, Mr. Flint's style was more low key.

When faced with a problem, he liked to spend time considering it, and would map out potential actions and outcomes on pieces of paper, according to people familiar with his working methods. He often sat in meetings taking in information with a pensive air, but without expressing his own views, the people said.

After starting as CEO in February 2018, Mr. Flint sought to make HSBC a more inclusive and pleasant place to work, developing a plan he called "the healthiest human system" to encourage a better work-life balance for HSBC employees. The touchy-feely message resonated with many of the bank's staff, but also led some executives to question what the bank's priorities were.

In June 2018, Mr. Flint updated the bank's strategy, largely sticking to Mr. Gulliver's plans but also announcing up to $17 billion in new spending on digital banking and developing HSBC's small but growing retail business in the Pearl River Delta region of China. Another priority was to turn around the bank's low-return U.S. business, which shrunk after losing billions of dollars in the financial crisis and still hasn't right-sized its revenues.

But world events threw in obstacles.

In the U.K., HSBC faced a cooling economy and a loss of confidence from households and businesses because of Brexit.

Rhetoric and tariffs between the U.S. and China in a continuing trade dispute also stepped up, threatening to curb HSBC's revenue in Asia, and elsewhere, from trade finance and loans to multinational companies for investment. The bank is one of the world's largest in financing global trade.

In February, Mr. Flint faced another test when HSBC's full-year earnings were worse than expected, in part because costs were outstripping revenue growth. Investments would be staggered or delayed this year, Mr. Flint said at the time.

On Monday, HSBC took a stronger approach, saying around 2% of jobs would be cut from its workforce of 237,685 to counteract expected falls in revenue.

In his last memo to staff, Mr. Flint thanked them for "support and kindness," and said he had sought to elevate "the human dimension" of life at HSBC while he was CEO.

Write to Margot Patrick at margot.patrick@wsj.com

 

(END) Dow Jones Newswires

August 05, 2019 10:01 ET (14:01 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
HSBC (NYSE:HSBC)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more HSBC Charts.
HSBC (NYSE:HSBC)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more HSBC Charts.