The battle to succeed Stephen Green as chairman of HSBC has turned ugly. The bank took the unusual step of issuing an angry, and public, denial of a report in the Financial Times that chief executive Michael Geoghegan had threatened to quit if denied the top job. In it, spokesman Patrick McGuinness said: "It is nonsense that the group CEO threatened to resign unless he was appointed chairman. The suggestion is offensive to Mike and to the company. As previously stated, the board is working under due process to finalise HSBC's succession plan following Stephen Green's already announced departure and this proceeds in line with the scheduled timetable."
Angry denial it may have been, but it took quite some time for the statement to be made: it flashed up on the newswires at 3.10pm UK time yesterday, 10.10pm Hong Kong time. Hong Kong is where Mr Geoghegan, moved amid some fanfare (and with an £800,000 relocation package).
Its seems unlikely that Mr Geoghegan, nor anyone close to him, leaked the alleged "threat". It could only damage him and heighten the questions about whether he is really the right man to serve as chairman, a job which requires the incumbent to gladhand with the City, with regulators and with the politicians who have so much influence over HSBC's business these days.
The delayed denial, however, is an indication of just how sensitive and difficult the issue has become for a bank that likes to portray itself as a model of corporate stability.
HSBC's board will meet next week to finally settle the vexed question. But in previous years there has never been a question. The chief executive has just seamlessly stepped into the chairman's shoes. That was how Mr Green assumed the top job after the departure of Sir John Bond.
But Mr Geoghegan is not Mr Green. The latter believes in God, the former sometimes gives the impression that he thinks he is one. During an early results presentation after being made chief executive, journalists were treated to a lengthy and self-aggrandising presentation on HSBC's marvellous businesses around the world and the roles he performed for them. This at a time when the company was still reeling from its disastrous foray into US sub-prime loans which resulted in the first profit warnings in its history.
No one denies Mr Geoghegan's talent. He steered the bank through the financial crisis with some skill, and the purchase of Household in the US business was Sir John's signature deal, not his. He's also managed to smooth some of the rough edges.
But he remains a bruiser. And with shareholders restive over the bank's attempt to hand him a bumper pay rise (and over that relocation package) his appointment could easily create a squall that the bank would rather avoid. However, passing him over would be seen as a slap in the face. Hence the story and the furious but belated response.
All this threatens to make the new chairman's task very difficult. Working with a wounded Mr Geoghegan could create tensions, particularly with John Thornton, the former Goldman Sachs banker who is currently a non-executive director. He might be the favourite among many commentators, just not so much with Mr Geoghegan.
The there's the question of Stuart Gulliver, the head of the investment bank who might have hoped to succeed Mr Geoghegan. All this with the top job at Lloyds up for grabs. Douglas Flint, the finance director, has been mentioned as a compromise candidate, as has Simon Robertson, who is leading the succession process. But whoever ultimately succeeds, HSBC, unusually, has allowed itself to get into a lose-lose situation.