HSBC has appointed a former US regulator as a non-executive director as the bank moves to clean up its operations following a damaging fine for breaching money laundering and sanctions rules.
HSBC paid US regulators $1.9bn in 2012 to settle claims that it failed to prevent money laundering in Mexico and Columbia and violated sanctions in Iran, Libya, Sudan and Myanmar.
The bank is also involved in the global investigations into the manipulation of the foreign exchange market and the fixing of Libor and other benchmark interest rates.
It announced on Friday that Kathleen Casey, who was commissioner of the US Securities and Exchange Commission from 2006 to 2011, would join the bank as a non-executive director next month.
Ms Casey has close US political connections, having spent 13 years on Capitol Hill, where she worked for the United States Senate Committee on Banking, Housing, and Urban Affairs and was chief of staff for US senator Richard Shelby.
HSBC said she would join its audit committee and its financial system vulnerabilities committee, which is tasked with identifying key emerging risks.
Commenting on her appointment, Douglas Flint, chairman of HSBC, said: “Kathy brings with her a wealth of experience of financial services regulation gained at a key time in the evolution of the sector, which will be of particular relevance and value to the board.”
Ms Casey is the fifth female member of HSBC’s board.
Her appointment comes ahead of HSBC’s full-year results announcement, due on Monday.
Analysts expect the bank to report pre-tax profit of about $24.7bn, up from $21.7bn in 2012. They are preparing to question Stuart Gulliver, chief executive, on his plans to strengthen the bank’s capital position, and the risks posed by a slowdown in emerging markets growth.
Mr Gulliver has repositioned HSBC away from risky markets – those he believes could be reputationally or ethically problematic – since it was hit with the 2012 fine.
The bank has retreated from a range of activities in parts of Asia and Latin America – areas where it is harder for lenders to vet customers. Also, while rivals such as Standard Chartered have entered potentially high-risk countries including Myanmar and Angola in the past year, HSBC has refused to go into these kinds of areas.
The bank’s shares, which have fallen 8.5 per cent in the past year, rose 3p to 655.2p on Friday.