London: Europe’s largest bank HSBC informed the financial markets on Monday it would remain headquartered in Britain, rejecting a move to Hong Kong despite concerns about increased regulation in the UK. The Hong Kong and Shanghai Banking Corporation said in a note to the London Stock Exchange following a board meeting on Sunday that London’s many advantages meant it was “ideally positioned” to provide a home base.
“Having our headquarters in the UK and our significant business in Asia Pacific delivers the best of both worlds to our stakeholders,” Group Chairman Douglas Flint told BBC radio. It made no reference to growing fears in Hong Kong that the city’s freedoms are being eroded by an increasingly influential China, a trend observers say could damage its status as a freewheeling finance hub.
The bank began its review of where to put its headquarters in April last year, two weeks before a British general election, amid growing calls for a crackdown on a sector seen by many voters as feckless.
It also cited as a reason for the review the British bank levy introduced in 2010 — a tax based on the size of any British-based banks’ global balance sheet which has since been scaled down.
A British finance ministry spokeswoman said the decision was “a vote of confidence in the government’s economic plan and a boost to our goal of making the UK a great place to do more business with China and the rest of Asia”.
The final choice had been between Britain and Hong Kong, although the review had also reportedly considered Germany and the United States.
The decision will come as a relief to the City, where bank stocks have suffered this year and there is growing concern about uncertainty from a referendum on Britain’s EU membership expected this year. — AFP
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