HSBC Boss Pledges Extra Checks for 'Bad Actors'

Stuart Gulliver, the chief executive, used an offshore firm in Panama to hold pounds 5m of his personal wealth.

Published: 23rd April 2016 10:17 AM  |   Last Updated: 23rd April 2016 10:17 AM   |  A+A-


People walk past the head office of HSBC bank in Mumbai November 20, 2008. REUTERS

HSBC has told shareholders it will do more to exclude "bad actors" from using its services after the Panama Papers scandal, although it noted that less than 5pc of the bank's 2,300 shell companies mentioned in the data leak were still operating.

The bank also fielded complaints from investors about its lacklustre share price, regulatory issues in the US and amount it pays its most senior staff, although almost all shareholders voted to support all proposals at its annual meeting in London.

Chairman Douglas Flint said the Panamanian documents emphasised the need to "ensure we are playing our part in keeping bad actors out of the financial system". "The so-called Panama Papers have highlighted once again how perfectly legal corporate structures can be abused to facilitate money laundering or tax evasion," he said.

Stuart Gulliver, the chief executive, used an offshore firm in Panama to hold pounds 5m of his personal wealth.

The bank said the small number of Panamanian shell companies remaining under its auspices were doing so in compliance with the law - and in some cases because law enforcement bodies wanted to monitor them.

The group also tried to reassure shareholders about its dwindling share price, with Mr Flint pointing out that just six of the 29 globally significant banks around the world trade above their book value, and that HSBC's 25pc discount to book value is better than the 50pc shortfall at other UK-based lenders. "I and the management team share your concern and frustration," said Mr Gulliver. "The share price is not where we want it to be."

The institution has started looking for a replacement for its chairman, who will in turn appoint a new chief executive.

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