HSBC could leave London for a new home in Asia due to UK tax jump

Douglas Flint, HSBC chairman, revealed that shareholders have been asking the board why it chooses to remain in London in light of tightening regulation.

?We are beginning to see the final shape of regulation, the final shape of structural reform and as soon as that mist lifts sufficiently, we will once again start to look at where the best place for HSBC is,? said Flint.

He made the comment at a shareholder meeting in Hong Kong, after an investor raised the issue of whether the bank should move.?

The bank?s shareholders are said to be questioning its headquarters because of George Osborne?s bank levy, which cost HSBC ?750m in 2014.?

The Labour party plans to increase tax by ?800m to ?4.5bn a year for the banking industry, to pay for childcare, if it wins.

Flint described the levy as a tax on staying in London.

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?There is a very clear risk that HSBC can reach a pain threshold where it think it is no longer worth staying in the UK,? said Richard Buxton, head of equities at Old Mutual Global Investors.

According to Paul Mumford, senior investment manager at Cavendish Asset Management, which owns stock in the bank: “HSBC might well be firing warning shots on their possible relocation to […] tell politicians they won?t be bullied.”?

Flint suggested that the bank?has two “home” markets: Britain and Hong Kong.

It moved from Hong Kong to London in 1993 when?bought Midland Bank?was purchased, and its most likely move would be back to the organisation’s former home.

The news follows its?decision to relocate 1,000 head office jobs to Birmingham?as part of the Financial Conduct Authority requirement that banks “ring-fence” retail and business banking arms.?

By Shan? Schutte

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