HSBC does not speculate on its own speculations

In a Bloomberg article of the 4th of April 2018 it has been reported that:

HSBC Holdings Plc Chief Executive Officer John Flint and Chairman Mark Tucker are considering shrinking the bank’s global imprint even further as part of a plan set to be revealed over coming months, according to people with knowledge of the discussions. Flint, who took over in February, is reviewing as many as a quarter of the 67 countries the bank operates in, and is mulling an exit or sale from smaller consumer operations such as Bermuda, Malta and Uruguay, said the people, who asked not to be identified because the strategy isn’t finalized.

Naturally this caused quite a stir in the countries that may face the chopping board of the World’s former local bank and such an announcement can be expected to have repercussions on the bank’s stock price as well as that of other listed entities it controls such as HSBC Bank Malta which was controversially acquired in 1999 from the government of Malta at a price which bore little relation to the bank’s actual stock price on the Malta Stock Exchange. It also leads to justified concerns being raised by both the bank’s employees and its clients.

Now, when the premier financial press, such as Bloomberg, quotes “people with knowledge of the discussions” it is safe to assume that they are referring to first hand sources involved in the deliberations being reported. Faced with such a veritable leak the bank and the Malta Stock Exchange have considerable responsibilities towards minority shareholders and other stakeholders which, quite frankly, they cannot shirk with a feeble Company Announcement such as the one released today by the Board which states:

Reference is made to reports in the local media re-reporting an article published yesterday by an international news agency speculating on the HSBC Group’s future global strategy. The bank informs the market that the HSBC Bank Malta p.l.c. Board has no information that requires a further company announcement and that the bank’s media policy is not to comment on speculative stories.

These directors are there to safeguard the interests of ALL shareholders and, if they have no information, they should remember their fiduciary duties and MUST actively seek out and demand further details and inform the market accordingly to avoid adverse repercussions on the aforementioned shareholders. On its part the Exchange has to actively do the same since we now have, once again, a situation where a majority shareholder controls all the information and does not deign to trickle any of it to the other shareholders as provided for in the listing rules and Article 402 of the Companies Act which gives any shareholder of the company (whether majority shareholder or otherwise) the opportunity to make an application to the court if he/she feels that the:

Affairs of the company have been or are being or are likely to be conducted in a manner that is, or that any acts or omissions of the company have been or are likely to be, oppressive, unfairly discriminatory against or unfairly prejudicial to a member or members or in a manner that is contrary to the interests of the members as a whole.