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Something just shy of half of HSBC’s business is done in its namesake cities of Hong Kong, Shanghai and the rest of China beyond. This has the government of London-based HSBC’s home country wondering, specifically about the business that HSBC is no longer doing with pro-democracy activists in Hong Kong on account of China’s decision to start ignoring its obligations under a treaty with that government. Well, CEO Noel Quinn isn’t wondering, at all. If persecuting those who’d like to enjoy the freedoms they were promised under that treaty between the U.K. and China on behalf of the latter’s ruling Communist Party, it isn’t costing him any sleep.

“We do not make freezing decisions based on political affiliation or activity,” Quinn said in his opening remarks. “It’s because we are obliged to, under request of police authorities, as they undertake their investigations.”

Quinn emphasised that the London-based bank had only been in dialogue with local police and no other Chinese authorities, and that HSBC would be committing a criminal offence if it did not follow the order, which could put the institution and its customers at risk….

“I am not in Hong Kong purely because of the profit,” Quinn said. “It’s not a matter for me whether I choose China over the UK or China over another political system. My motive is 100 per cent about helping people in Hong Kong recover from the challenges they face, and I have to work within the legal framework I’m given in Hong Kong.”

And beyond the profits and the helping the people in Hong Kong that he’s allowed to help, there’s also the benefit of not getting the uncomfortable questions directed at Quinn’s peers who’ve decided that chewing gum in public is not as important as not waiting around to see what happens next in the now significantly less Special Administrative Region.

Government agencies including the Securities and Futures Commission of Hong Kong, the Hong Kong Monetary Authority, the Hong Kong Financial Services and the Treasury Bureau and the Financial Services Development Council have phoned banking and asset management executives who have relocated to rival cities including Singapore and Tokyo, according to three people with direct knowledge of the calls.

The calls, which hedge fund managers described as new and unusual, asked for a full picture of the decision-making process behind the moves and the significance of the timing…. Fund managers said that while it was not uncommon for the SFC to contact funds leaving Hong Kong to ask about a change in licensing status, the calls from the other agencies and the tone of the questioning were unusual.

HSBC boss defends move to freeze accounts of fugitive ex-lawmaker Ted Hui, tells British MPs bank is committed to Hong Kong [South China Morning Post]
Hong Kong grills finance executives on reasons for leaving [FT]


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