One of HSBC's UK directors has resigned from his position ahead of new rules that strengthen the hand of regulators to penalised managers of failed banks.
City A.M. understands Alan Thomson, a member of the audit and risk committees of HSBC Bank, has tendered his resignation and will leave the board in October.
Sky News initially broke the story and also reported that John Trueman, deputy chairman of HSBC UK's high street and commercial banking arm, is “on the verge of resigning”. He took on his role in December last year, though has been a director of HSBC Bank since 2004.
Sky News quotes sources close to the situation who claimed the moves came as a direct consequence of the proposals by the Bank of England's supervisory arm the Prudential Regulation Authority (PRA), which will make senior bankers more accountable for the failings at institutions they manage.
It also quotes a lawyer close to another major UK bank as saying “this is just the tip of the iceberg”.
The PRA is currently consulting on proposals that could see bank directors and other executives face criminal proceedings if it is thought they made reckless decisions leading to the collapse of their employer.
Disciplinary action could be doubled from a maximum of three years to six, while managers will be obliged to certify that all customer-facing staff and material risk-takers are capable of performing their duties. Bankers could also be forced to defer bonuses for seven years from the point of award.
Lawyers argue the new measures create a “guilty until proven innocent” framework.
Yesterday, the PRA set out further details of its plans to ring-fence high street lenders from the same groups' investment banking arms by 2019. Banks must submit their proposals by the year-end.
HSBC declined to comment.