Cultural change breaks iron rice bowls at HSBC
HSBC is so known for the loyalty of its senior management that many top executives who have started their careers with the bank choose to stay until they retire.
But the resignation of Michael Smith may signal the end of the job-for-life culture at the 140-year-old lender. His decision to end his 29-year stint with HSBC and jump ship to Australia & New Zealand Banking Group is the second blow to the executive team in as many months.
Last month, Blair Pickerell resigned as chief executive for Asia-Pacific at HSBC Investments (Hong Kong) to join Morgan Stanley as head of Asian investment management.
The departure of Mr Pickerell, who joined HSBC three years ago, was less shocking than Mr Smith, 50, who started with the bank in 1978.
In an interview last year, Mr Smith made no attempt to hide his loyalty to the bank, saying he had rejected many offers to change employers and was proud of his track record.
Jerry Chang, a director of international headhunter Baron & Co, believes Mr Smith's eye was not only on the A$9 million (HK$59.2 million) package offered by ANZ but on higher job satisfaction.
'Top bankers are very rich already, so the pay package is not the only reason for them to move on,' Mr Chang said. 'Someone like Mr Smith, who came from a big bank like HSBC, would be capable of helping a smaller player like ANZ grow.'
Another headhunter said the bank's transformation into a global player in recent years had also prompted loyal executives to consider changing jobs.
'When HSBC was a regional bank, it could keep the tradition of putting only homegrown executives at the top but such traditions break,' said the headhunter. '[Previously], senior management had seldom moved on because the bank had a strong executive team who trained and worked together until they retired.'
New faces are appearing at the top of HSBC's management. Peter Wong Tung-shun, an executive director of the Hong Kong unit, joined three years ago from Standard Chartered Bank. Conrado Engel, a regional director of personal financial services for Asia-Pacific at Hongkong and Shanghai Banking Corp, joined in 2004 when HSBC bought the bank.
Mr Smith joined as a junior banker in Hong Kong in 1978 after graduating with honours from London's City University. After stints in the Solomon Islands, Middle East, Australia, South America, Malaysia and Britain, he became chief executive of Hongkong and Shanghai Banking Corp in 2004 and chairman of Hang Seng Bank in 2005.