Investors punish HSBC, Standard Chartered for scrapping dividends, wiping billions off shares and calling for headquarters to move to Hong Kong
- HSBC, Standard Chartered axed dividends, suspended buy-backs after request from UK regulator on Wednesday
- Investors call on banks to move HQ to HK. HSBC says will not revisit issue
From retirees to global insurers and investment managers, outraged shareholders in Hong Kong have wiped billions of dollars in value off HSBC’s and Standard Chartered’s shares after the banks axed dividends and suspended share buy-backs on Wednesday.
Over the course of two days, HSBC’s shares in Hong Kong have lost 12 per cent of their value, plumbing their lowest level since the depths of the global financial crisis in March 2009. Standard Chartered’s stock did not fare much better, dropping 8 per cent since Tuesday’s close.
The move was bitter reminder to Hongkongers that they have little say in matters relating to their city's defence, diplomacy and now, even the dividends paid by some of the world's largest banks. The stocks touch the lives of many Hongkongers who often give HSBC’s shares as graduation or wedding gifts. About a third of HSBC’s shares are held by retail investors.
“I understand it is a tough time but how can a regulator just order the bank to hurt investors. It's not fair,” said Mrs Mak who owns about US$1 million worth of HSBC shares, some of which she inherited from her father who bought the shares more than half a century ago. She asked to be identified only by her last name.
Many of the city’s retirees rely on dividend streams from HSBC and Standard Chartered for a living.