HSBC to review pay and bonuses, as Green vows to stay

Stephen Green, 61, moved to quash mounting speculation he was preparing to stand down this year, telling investors at the bank's annual general meeting that he looked forward to "chairing the next AGM in 2011".

The bank also said its independent remuneration committee would review pay practices this summer, in consultation with shareholders – a move that came as 13 per cent of investor votes were cast against its remuneration report.

The protest vote comes after Pirc, the vocal shareholder advisory group, raised worries about the bank's pay practices and recommended investors oppose its remuneration report at yesterday's meeting.

Central to its concerns was the 800,000 award to cover chief executive Michael Geoghegan's relocation costs to Hong Kong. This has since overshadowed the news that he gave a 4 million shares bonus to charity.

HSBC has also been criticised for paying a 9m deferred shares bonus to Stuart Gulliver, head of its investment bank.

He was entitled to the bumper payout after the group delivered a robust performance last year, reporting underlying pre-tax profits up 56 per cent to $13.3 billion (9.1bn).

The bank said it was committed to ensuring it had the right bonus and pay structure in place, but stressed it needed to pay competitively.

Green said: "We must never see egregious rewards for failure in the banking sector again.

"Compensation must be aligned to risk and must be subject to deferral. It is only then we can see that profitability is real and ensure it can be clawed back if performance later turns out to be unsatisfactory."

His decision to relinquish his responsibility for group strategy to Geoghegan last September fuelled succession rumours.

However, Green – who has been chairman since 2006, having previously acted as chief executive for three years – said "we have nothing to announce".

He added: "At HSBC, we discuss succession for all key roles, both at board and senior management level."