'I decided to quit ten days ago' says HSBC's Michael Geoghegan

A DRAMATIC boardroom shake-up was confirmed at banking giant HSBC last night as chief executive Michael Geoghegan, embroiled in days of feverish speculation, revealed he made up his mind to quit about ten days ago.

• HSBC chief executive Michael Geoghegan Picture: PA

Geoghegan said it was then that he learnt that HSBC's Scottish finance director Douglas Flint was the preferred choice of the nominations committee to succeed outgoing Stephen Green as executive chairman.

Asked if he had wanted Green's job, the Hong Kong-based chief executive said: "I loved being chief executive. I never went out of my way to be chairman. You have to be asked. The reality is I was not asked."

Geoghegan, who will leave HSBC with a severance package of 1.42 million, as well as a 200,000 three-month consultancy fee that he is donating to charity, said he had had sensible discussions with colleagues about the chairmanship succession. He said he was told that while he was a good chief executive somebody else would make a better chairman.

As part of yesterday's dramatic change at HSBC, Geoghegan will be replaced as chief executive by Stuart Gulliver, the current head of investment banking. This echoes the appointment of Bob Diamond as chief executive-designate at Barclays, where he had been head of investment banking.

Geoghegan added that Green's announcement two weeks ago that he was leaving to join the government as trade minister had "triggered my own thinking" about when it was best to move on after four and a half years in the chief executive's role.

Geoghegan, who relocated to Hong Kong in the spring in recognition of HSBC's belief that the geographical centre of economic growth was moving east, said he had decided he wanted to leave the new top team time to shape the group after having told colleagues five to six years was the maximum for a chief executive in his position.

Asked about his plans, Geoghegan said: "I will think through the options. I'm fairly entrepreneurial. I like business and like turning around businesses."

Green, Geoghegan and the senior independent director, Sir Simon Robertson, said the transition had been speeded up following Green's announcement that he was leaving, but denied there had been boardroom dissent about the changes.

Green said the speculation that Geoghegan had threatened to resign if he did not get the chairmanship was "irresponsible", and HSBC's board would reflect on whether to launch an investigation into "blatantly wrong leaks".

Gulliver takes up his new post at the end of this year, when Green is joining the government as trade minister at David Cameron's request. Flint will take over as chairman on 3 December.

Sandy Flockhart becomes chairman of HSBC in the UK, while Iain Mackay succeeds Flint as finance director. Mackay is currently finance officer for Asia-Pacific