Murthy on HSBC board as profits rise on Asian successMarch 3rd, 2008 - 11:24 pm ICT by admin
By Dipankar De Sarkar
London, March 3 (IANS) Infosys founder N.R. Narayana Murthy is to be inducted as a non-executive director of HSBC Holdings, Europe’s largest bank, which Monday reported second-half profits as rising 17 percent on the back of emerging market lending. The induction of Murthy was part of a board revamp with the bank expected to focus on China, India and other emerging markets.
“The economic slowdown and the credit outlook in the US may well get worse before they get better,” Group chairman Stephen Green said.
“With significant parts of the international financial system in developed markets still in difficulties, HSBC’s emphasis on faster-growing emerging markets means that we are better positioned than many of our competitors.”
The bank said second-half profits rose 17 percent as emerging-markets accounted for 78 percent of earnings, compared to 55 percent in the second half of 2006, and outweighed losses resulting from the US subprime mortgage.
The company reported a $2.34 billion loss in North America but earnings rose 59 percent to $4 billion in Hong Kong and 43 percent to $2.67 billion for the rest of Asia Pacific.
Bad loans rose to $17.2 billion in 2007, compared with $10.6 billion in 2006.
The bank said Stuart Gulliver, chief executive of HSBC’s investment bank, and Sandy Flockhart, global head of commercial banking, will join the executive board May 1, taking their place alongside Vincent Cheng, recently appointed chairman of HSBC Asia-Pacific.
“These are three of our most talented and experienced executives - all emerging market specialists,” said Green.
Green, chief executive Mike Geoghegan and finance director Douglas Flint are the other three executive directors.
Three members of the non-executive board - Baronness Dunn, Sir Brian Moffat and Lord Butler - are to step down to make way for Murthy and Safra Catz, President and CFO of Oracle.
The British media has previously reported that new appointments were being planned to address criticism that the board is not independent enough and that they might eventually lead to the appointment of a non-executive group chairman.
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