HSBC has been forced to insist its plan to install more than 1,000 key staff in Birmingham is on track, after the process was reportedly described as “in crisis” by an official monitor at Britain’s biggest bank.
The monitor – who is overseeing the bank’s attempts to overhaul its systems after a £1.2bn fine for money laundering offences from the US in 2012 – is reported to have been concerned about the number of staff willing to move from London to Birmingham, which the bank has selected as the headquarters of its main UK operations.
However, the monitor, Michael Cherkasky, is reported to have been convinced by the bank to eventually change his assessment of the operation as “in crisis”.
HSBC refused to comment on the monitor’s work while Cherkasky would not comment either. But the bank responded to the report in the Times (£) by insisting that the aim to move 1,000 staff to a new head office in Birmingham was not behind schedule.
The Birmingham move has been prompted by rules requiring UK banks to ringfence their high street operations from their investment banking arms, as outlined by Sir John Vickers in his report on banking in 2011.
Dame Clara Furse, the former chief executive of the London Stock Exchange, is to become chair of the operation. Other banks are also racing to comply with the rules which comes into force at the start of 2019.
Nigel Hinshelwood, head of HSBC’s UK bank, said: “We always knew that moving more than 1,000 roles from London to Birmingham was going to be a major undertaking. We also understood that not everyone would want to or be able to move due to personal commitments. That’s why we have phased this over three and a half years. We’re ahead of where we planned to be by this point in the project and by the end of this year, more than a quarter of the roles will already be based in Birmingham.”
By the end of the year, the remaining 700 or so London-based staff will have to inform the bank whether they intend to move. Those who decide not to do so could face redundancy. Last year only 13% of those staff earmarked for relocation had indicated they were ready to take on the move, although that figure is said to be increasing.
A report by estate agents Knight Frank published last week said Birmingham was enjoying a renaissance, fuelled by manufacturers and the arrival of big banks and professional services firms, as well as the planned HS2 rail link.
The monitor makes an annual report to regulators in the UK and US, and HSBC admitted in February – when it published its results for 2015 – that “significant concerns” had been raised about the slow pace of change to its procedures to combat crime.
This article was written by Jill Treanor, for theguardian.com on Monday 14th November 2016 16.10 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010