Europe’s biggest bank HSBC mulls moving headquarters out of Britain
Europe's biggest bank HSBC is considering moving its headquarters here out of Britain following "regulatory and structural reforms" imposed after the 2008 financial crisis. The board has asked its management to "look at where the best place is for HSBC to be headquartered in this new environment," the bank said in a statement.
"The question is a complex one and it is too soon to say how long this will take or what the conclusion will be; but the work is under way," it added. The Hong Kong and Shanghai Bank Corporation (HSBC) has been headquartered in the UK since 1992, when it acquired the Midland Bank.
It employs more than 47,000 people in the UK, 1,000 of whom are to move to Birmingham as part of a recently announced relocation of its UK bank head office in London. HSBC is based in Britain but was founded in Hong Kong and makes much of its profits in Asia.
The bank historically conducted a review of its domicile every three years, although changes to regulation had put these on hold until now. The bank said the latest review of its HQ followed "regulatory and structural reforms" since the financial crisis.
The scandal-hit bank has recently faced allegations that it helped people evade UK tax using hidden HSBC accounts in Geneva. The review also follows plans announced in the Budget to increase the bank levy from 0.156 per cent to 0.21 per cent.
The levy particularly affects banks with large balance sheets, such as HSBC. Last year it paid 750 million pounds of the 1.9 billion pounds raised by the UK government through the tax. Under UK government reforms, universal banks such as HSBC and Barclays will have to erect a firewall between their high street and investment banking operations by 2019 in order to insulate taxpayers and customers in the event of a future financial crisis.
The news will come as a bombshell into the heart of the UK General Election campaign and is likely to spark a political row about whether banking reforms are undermining the competitiveness of a crucial sector of the UK economy.