LONDON: HSBC has launched a review of the location of its headquarters that could see it leave the UK, Europe’s biggest bank confirmed.
In a statement issued after Sky News exclusively revealed details of its plans, Douglas Flint, HSBC’s chairman, said executives had been asked by the lender’s board to undertake a review of its UK base.
As I said at our informal meeting in Hong Kong on Monday, we are beginning to see the final shape of regulation and of structural reform, including the requirement to ring fence in the UK,” Mr Flint is expected to say at HSBC’s annual general meeting in London later.
As part of the broader strategic review taking place, the board has therefore now asked management to commence work to look at where the best place is for HSBC to be headquartered in this new environment.
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.”The bank’s share price rose more than 2.5% on the FTSE 100 when the news emerged.
Sources said directors of HSBC Holdings had agreed at a board meeting on Thursday to undertake the domicile review, which is likely to take around six months.
The news dropped a bombshell into the heart of the General Election campaign, with Labour suggesting it was a direct response to the threat of the UK leaving the EU under any Tory government.
It was also certain to spark a political row about whether banking reforms are undermining the competitiveness of a crucial sector of the UK economy.
A committee of executives, led by chief executive Stuart Gulliver, will report to HSBC Holdings’ board on the headquarters review, sources added.
HSBC is a substantial payer of corporation tax in the UK, but its board has become increasingly concerned that bank-specific taxes and the future shape of regulation are making it uneconomic to remain based here.
