HSBC plans to stay based in London despite China expansion
HSBC Holdings will keep its headquarters in London but is determined to expand its business on the mainland following a surprise shake-up of top management.
Outgoing chairman Stephen Green said before a board meeting in Shanghai yesterday that Europe's largest bank had 'no current plan' to relocate its headquarters.
The remarks by Green, who will become Britain's trade minister in January, ended speculation that HSBC would return to its Asian roots. HSBC announced last week that chief financial officer Douglas Flint would be group chairman, replacing Green, while Stuart Gulliver, head of investment banking, would be made chief executive officer, replacing Michael Geoghegan.
In January, Geoghegan moved his office to Hong Kong, triggering speculation that the London-based bank would relocate its headquarters to Asia, where it is making handsome profits.
The shake-up of top management made headlines worldwide after Green announced in early September that he would join the British government. The banking and investment communities had been rife with speculation about who would succeed the departing chairman.
HSBC was founded in 1865 in Hong Kong and Shanghai and it is still seen as a symbol of the mainland city's commercial heritage. At that time, the bank specialised in trade finance between China, Europe and India.
HSBC was locally incorporated on the mainland in 2007 in tandem with the opening of the banking sector to international players. It currently has 100 outlets across the mainland, the most among foreign banks.
'Our policy will remain committed to building up our business in China,' Green said. 'There is no country strategically more important to us.'
The board meeting in Shanghai is the second time that the top bosses of HSBC have gathered in the city to discuss broad strategies of the bank. The last similar meeting was in 2004.
HSBC plans to float initial public offering shares on the pending international board at the Shanghai Stock Exchange and is likely to raise at least US$5 billion to fund its mainland expansion.
It is likely to become the first foreign company to launch an A-share IPO as Beijing liberalises the capital market.
The banking giant's profits in Asia jumped 48 per cent in the first half, helping it to double earnings to US$6.76 billion.
Green believed the new top management team, effective from January 11, would be as successful as the team of Geoghegan and himself.
