HSBC Holdings PLC's (LSE:HSBA) largest shareholder Ping An has publicly called for the London-based bank to spin off its Asia business and also urged it to cut its costs aggressively.
In a statement, Ping An Asset Management said HSBC “should be much more aggressive in radically reducing its costs”, for example by cutting manpower.
“This is the most important, urgent and absolutely needed action for HSBC to improve its business performance, reducing costs and increasing efficiency, particularly amid slowing growth in the global financial industry,” the Chinese insurance company said.
HSBC is aiming to reduce costs by US$5.5bn by the end of this year and a further US$1bn next year.
The bank said in a statement it is on track to meet all of its financial targets from 2023 onwards, adding that it has "kept a tight grip on costs by driving greater efficiencies across the organisation”.
For the first time, Ping An publicly called on HSBC to spin off its Asian business. The bank makes the bulk of its sales and profit in Asia and has been under pressure from the Chinese company to look at ways of boosting shareholder returns, including separately listing its Asia business.
“We will support any initiatives including a spin-off that are conducive to improve HSBC's performance and value; we will consider any suggestions that will help HSBC improve its development and operation strategy," Ping An said.
Ping An has a stake of more than 8% in HSBC.
HSBC shares rose 3.42% to 479.00p in late morning trade in London.