HSBC to move out of London?
The World’s financial markets have been shocked by the news that the world’s second biggest bank HSBC is reviewing its headquarters in London and is considering moving elsewhere, probably to its natural base in Hong Kong.
HSBC have had their headquarters in London since 1992, after they purchased Midland Bank, one of the UK’s ‘big four’ banks.
Why have they decided to do this review now? There are many possible reasons, the UK is in the middle of a general election and the results are uncertain. Banks don’t like uncertainty and if the Conservatives lose control the Labour party or a Labour party led coalition may impose greater restrictions on banks.
There has already been announced in the budget a rise in the bank levy from 0.156 to 0.21%, a not unsubstantiatial rise to HSBC who are already the biggest contributor to the levy in the UK. If the Conservatives retain control they have promised to hold a referendum on EU membership and that is already causing uncertainty in the financial sectors.
It might be that investors like this news because HSBC share values rose after the announcement. If the move goes ahead there would be a huge cost involved and if moving to Hong Kong would the political landscape be any more stable? Is it a bit of sabre rattling by HSBC sending a warning signal to those wanting to increase financial controls? When the decision is made we will be reporting and assessing the impact on HSBC stocks and shares and the UK economy in general.
