'Lying' bank's bonuses 'should be withheld'

23 November 2007

Top executives at British bank HSBC should have their bonuses cancelled next March as the bank misrepresented the incentive scheme to shareholders, fund manager Knight Vinke has claimed.

The rebel shareholder has placed adverts in British newspapers campaigning against the bank and accusing it of giving false impressions to shareholders.

Five of HSBC's top executives, including chairman Stephen Green, chief executive Mike Geoghegan and finance director Douglas Flint are due to pick up around $11.9 million in bonuses, the Times reports.

Knight Vinke claims that the way it was represented to investors two years ago meant shareholders were led to believe that the bank would have had to have performed much better for the executives to receive bonuses.

The fund manager claims there is a discrepancy where HSBC's chiefs stood to gain bonuses "despite more than $20 billion of provisions for credit and trading-related losses over the past two years".

HSBC has denied any wrongdoing and insists the scheme was discussed in detail with 50 top shareholders and the Association of British Insurers.

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