HSBC is staying in the UK – at least until 2015.
Chairman Douglas Flint said on Monday that the bank's current review of where to locate its headquarters has been deferred. There is too much regulatory uncertainty, and too much legislative reform on the slipway, to make a sensible decision before then, argued Flint.
Should we rejoice? No. It is better to laugh at HSBC's continuing arrogance in thinking of itself as a model global citizen that would be welcomed wherever it wishes to land. The reality is that, after the money-laundering allegations against the bank in the US and the looming £1bn-plus penalty, brand HSBC is not what it was. Which regulator would offer an unequivocal embrace to a firm that is clearly so big it is hard to manage and will be watched like a hawk in future by US authorities?
Besides, HSBC, which has been based in the UK for a quarter of a century, would have to clear any emigration proposal with its shareholders. There may (currently) be a tax advantage to not being British. But do investors really want to see the bank base itself in Hong Kong, on the doorstep on the Chinese Communist party? Almost certainly not.
Given the lack of historical ties, adopting Singapore or Australia would make HSBC look like the wandering bank, which cannot be good for the reputation. That is how here-today-gone-tomorrow hedge funds behave, not top-tier international banks. No, it's London for several decades yet.
Instead of pretending that there's a real decision to be made in 2015, Flint would do better to drop these three-yearly reviews into where to locate the HQ. The game of will-they-won't-they has lost both suspense and the power to frighten politicians.
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image: © Howard Lake