HSBC: No decision made on moving from UK
Britain’s biggest bank HSBC today said it had not made a decision to leave the UK following reports but warned the country’s “competitive position needs protection”.
The bank, which more than doubled annual profits in 2010, was responding to a claim that a major, unnamed investor told The Sunday Telegraph “we were told that a move is now more than likely”.
HSBC, which has been headquartered in London for 19 years, warned key investors that the full-year results, which came in below analyst expectations, made arguments for moving to Hong Kong “overwhelming”, it was reported.
But an HSBC spokesman said “no decision whatsoever has been made”.
He added: “London is ideally positioned as an international financial centre and we have been clear that it is our preference to remain headquartered here.
“However, we are routinely asked by institutional investors about the costs of being headquartered in the UK and it’s clear that the City’s competitive position needs protection.”
The loss of HSBC’s headquarters in London, although threatened for months because of the increase in financial regulations, would be a severe blow to the coalition Government which is relying on a private-sector-led recovery.
The group posted on Monday pre-tax profits of $19bn (€13.6bn) last year, up from $7.1bn (€5bn) in 2009.
But despite the hefty rise in profits, shares fell 5% as the figure came in shy of the $20bn (€14.3bn) expected.
Investors were also disappointed at HSBC’s move to cut its profitability targets due to the cost of tougher global banking regulations.
HSBC used last week’s results as an opportunity to hit out at the impact of the UK’s new banking levy on international banking groups.
The levy, introduced in January, would have seen HSBC pay around $600m (€429m) if it was in place last year, the bank said.
HSBC was founded in 1885 in Hong Kong, and moved its headquarters to London in 1992 after acquiring Midland Bank. Every three years since then, the bank has undertaken a review of its base to check London still makes the most sense financially and strategically.
