HSBC drives FTSE higher over prospect of UK exit
The prospect of HSBC changing domicile has been a source of speculation for the financial media, analysts, and representatives of the bank since the financial crisis; however, the announcement is the first tangible suggestion that the bank could exit the UK.
In a speech to the bank’s annual general meeting today, HSBC chairman Douglas Flint said the review has been prompted by increased taxes, the spectre of an EU referendum, and “regulatory and structural reforms which have been put in place post-crisis.”
In January 2011, the Coalition introduced a new bank levy as part of a joint move with France and Germany, initially set at 0.04 per cent before rising to 0.07 per cent the next year. Both Labour and the Conservatives have not only pledged to maintain the levy after the 2015 General Election, but mooted the possibility that it could be raised in years to come. It is projected that £3bn will be raised via the levy over this year. Last year, HSBC paid £750m toward the bank levy, the highest figure of any British bank.
“The board has asked management to commence work to look at where the best place is for HSBC to be headquartered in this new environment,” said a spokesperson for HSBC. “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 underway.”