×

HSBC Chief Drops Hong Kong Relocation Plan

HSBC’s new chief executive has dropped plans to relocate to Hong Kong, choosing to remain in London.

The decision will mean that Stuart Gulliver, who for years has been one of Britain’s best paid bankers, will continue to pay UK income tax, unlike his predecessor Michael Geoghegan, who moved the CEO’s office to Hong Kong in 2009.

HSBC
AP
HSBC

The government is likely to welcome Mr Gulliver’s decision as it encourages banks to increase their support for British business.

Mr Gulliver had previously warned that HSBC could relocate abroad, most likely to Hong Kong, if the government forced banks to split their retail and investment banking businesses.

However, Mr Gulliver risks offending Asian officials, particularly in China, who had applauded HSBC’s move to shift its center of gravity back to Hong Kong. “Actually the reverse is true,” said one close associate. “He has appointed strong people to head the Asian offensive so he doesn’t need to be there all the time himself.”

Mr Gulliver believes the UK timezone is the most efficient from which to manage a global business. Douglas Flint, HSBC’s chairman, is also based in London. According to people close to him, Mr Gulliver is scheduled to spend an average of two weeks a month in the UK, a week in Hong Kong and a week travelling to other parts of HSBC’s global operations.

HSBC insiders stressed that Mr Gulliver had spent a large amount of time in Asia in recent weeks, meeting Wang Qishan, the Chinese vice-premier. He also has a home in Hong Kong.

This was echoed by the bank, which said: “Mr Gulliver has been group chief executive for 24 days, during which period he has spent more working time in Hong Kong and Beijing than anywhere else in the world.” It added that three key meetings of the bank had been held in Hong Kong.

The news contradicts the announce­ment in September when Mr Gulliver was appointed. “The principal office of the group chief executive will remain in Hong Kong where it moved in 2009. Mr Gulliver will therefore relocate there but maintain a regular presence at the group’s headquarters in London,” the bank said then.

HSBC is still awaiting clearance from the Chinese authorities to go ahead with a stock market listing in Shanghai. Bankers had thought that Mr Geoghegan’s Chinese charm offensive would have helped secure the listing by now.