The appointment has surprised the market, coming just one day after CEO Georges Elhedery stated that Mr Nelson, 76, had expressed a desire not to commit to the role for the typical six-to-nine-year tenure.

Mr Nelson, who has served as interim chair since 1 October, will now oversee HSBC’s aggressive restructuring strategy. Under Mr Elhedery, the bank is scaling back its Western operations to deepen its focus on Asia, which currently generates over half of its revenue.

The new chairman faces significant headwinds, including escalating trade tensions between the US and China. The bank recently warned that potential tariffs introduced by US President Donald Trump could impact future profitability targets. Additionally, Mr Nelson must support the bank’s shift towards fee-based income as central banks begin to cut policy rates.

Formerly the head of global banking at KPMG, Mr Nelson brings extensive UK and international auditing expertise, having served on the boards of BP and NatWest Group. However, unlike his predecessor Mark Tucker, Mr Nelson has spent the majority of his career in Britain and lacks a public track record in Asia.

While the bank described the selection as the result of a “robust process”, the appointment has drawn criticism regarding succession planning. Speaking to Reuters, John Cronin, an analyst at SeaPoint Insights, described the process as “utterly haphazard”, noting the lack of foresight for such a critical global finance role. Conversely, investors have characterised Mr Nelson as a “safe choice” to provide stability during the bank’s ongoing transformation.

Mr Nelson will remain chair of the group audit committee until the release of the bank’s 2025 results in February 2026.