HSBC Holdings Plc (HSBA.L) has named its Chief Financial Officer Georges Elhedery as the next CEO, the bank announced on Wednesday. This selection emphasizes the global lender's focus on continuity as it aims to boost growth.

Elhedery, 50, will become HSBC's third chief executive in under a decade, taking over from Noel Quinn on Sept. 2. While external candidates were considered, HSBC has historically promoted from within for its top position.

Since 2020, Elhedery has co-led the Global Banking and Markets division, which encompasses HSBC's trading and investment banking advisory operations and generated 24% of the group's revenues in the previous year.

Born in Lebanon, Elhedery began his banking career as a rates trader before joining HSBC in 2005. He was unexpectedly appointed as CFO in October 2022, shortly after returning from a sabbatical.

Previously, Elhedery served as CEO of HSBC's Middle East, North Africa and Turkey region from July 2016 to February 2019.

"I'm excited to work with our talented team to deliver outstanding value to our customers and shareholders by achieving strong performance and sustainable growth," he stated in the bank's announcement.

Quinn, who led HSBC for five years, will remain CEO until Elhedery assumes the role. When he surprisingly announced his departure in April, Quinn expressed a desire for better work-life balance and plans to pursue various board positions.

During his tenure, Quinn oversaw numerous asset sales, steered the bank through a global pandemic and investor pressure to split up the 160-year-old institution, and guided HSBC to record profits.

This transition occurs as HSBC, Europe's largest bank by assets with a $3 trillion balance sheet and in solid financial standing, is leveraging its historical Asian connections to increase profitability.

Since the 2008 financial crisis, HSBC has reduced its global presence by approximately 25%, exiting slower-growth markets to concentrate capital and resources in Asia, which accounts for the majority of its revenues and earnings.

Stanley Tsai, founder of Hong Kong-based Antler Capital investment advisory, wasn't surprised by the choice.

"Some investors might have preferred someone with more direct Asian experience, particularly in Greater China, but the non-Asian business has consistently presented the most significant challenges," he commented.

Nevertheless, HSBC is highly vulnerable to deteriorating China-West relations, and achieving growth targets in Asia will be challenging amid China's economic slowdown and potential geopolitical entanglements.

Elhedery must also manage HSBC's exposure to China's ongoing bad loans crisis, which resulted in a surprising $3 billion impairment charge last February on the bank's stake in Bank of Communications (BoCom).

Although he has limited direct work experience in Asia, having spent most of his HSBC career in Middle East and Africa roles, Elhedery reportedly learned Mandarin during his six-month sabbatical, according to bank sources and media reports.

HSBC stated it will announce Elhedery's successor as Group CFO in due course. Prior to the announcement, the bank was exploring financial incentives and reassigning key projects to retain those who weren't selected for the top position, according to two individuals familiar with the discussions.

HSBC is set to report its interim results on July 31.
The bank's shares in Hong Kong remained largely unchanged following the announcement. HSBC's stock has risen 7% this year, compared to an 18% increase in the STOXX Europe banks index (.SX7P).