News is out this weekend from the Telegraph and other news sources that the HSBC board is to shortly decide whether it will remain in the UK or re-domicile its HQ elsewhere, notably Hong Kong. A lot is at stake for the bank which employs over a quarter a million staff worldwide. Until recently, one would have thought the incentives to leave appeared strong, given the somewhat unfriendly regulatory environment (some would say), bank levy typically calculated on total assets (even if most of your operations are overseas), ring-fencing etc. However the environment started to change over the past several months with hopes of a softening of the ring-fencing rules, expectations that the levy may die off, and some changes in the personalities at the regulator. Also, just as the talk of a move to HK became credible, the Chinese economic machine began its decent. I like 80s music but not so much the Clash, but I think the lyrics go something like: If I go there will be trouble.. and if I stay it will be double.
However the talk is that HSBC may very well stay given the changing fortunes in both is current and prospective homes, at least for now. We should find out more this week. The Telegraph article can be found at http://www.telegraph.co.uk/finance/newsbysector/epic/hsba/12145047/HSBC-to-stay-in-London-as-board-meets-for-final-decision-on-HQ.html
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