HSBC looks at moving HQ from Britain as tax and regulations bite

Fri Apr 24, 2015 2:20pm EDT
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By Steve Slater and Sinead Cruise

LONDON (Reuters) - HSBC, Europe's biggest bank, has ordered a review into whether it should move its headquarters out of Britain and potentially back to its former home in Hong Kong, threatening London's reputation as a global hub for finance and investment.

The announcement from HSBC, founded in Asia but a key part of the British establishment, prompted a warm response from Hong Kong, where it is revered as "The Bank", and silence from the British government.

The commitment to the review comes less than two weeks before British parliamentary elections on May 7 and poses challenges for both Prime Minister David Cameron and his main challenger, Labour party leader Ed Miliband.

HSBC has been one of the most vocal critics of the regulations and additional taxes imposed on British banks in the wake of the 2007-2009 financial crisis and Chairman Douglas Flint singled out the threat of Britain withdrawing from the European Union in a speech to investors on Friday.

Cameron has pledged to hold a referendum on Britain's EU membership if his Conservative party is re-elected.

The opposition Labour party seized on HSBC's announcement.

“HSBC is just the latest in a long line of companies warning of the dangers of a re-elected Tory (Conservative) government taking Britain out of the European Union," said Labour finance spokesman Ed Balls.

A Conservative spokesman declined comment on HSBC.   Continued...

A branch of HSBC bank is seen near Westminster Abbey, in central London March 6, 2011. REUTERS/Stefan Wermuth