Stuart Gulliver, HSBC's new chief executive, has dropped plans to relocate from London to Hong Kong, just days after an announcement that UK bank reforms would be watered down.
Gulliver had warned HSBC could relocate abroad, most likely to Hong Kong, if the government forced banks to split their retail and investment banking businesses, the Financial Times reports.
But on Saturday, Sir John Vickers who head's up the Independent Commission on Banking (ICB), the government-backed body probing the sector in the wake of the credit crisis, said possible reforms to Britain's banks are unlikely to include a formal break-up of the top lenders.
Gulliver has reportedly said he believes the UK time zone is the most efficient from which to manage a global business. Douglas Flint, HSBC’s chairman, is also based in London.
Gulliver, who for years has been one of Britain’s best paid bankers, will continue to pay UK income tax as a result of the decision, unlike his predecessor Michael Geoghegan, who moved the CEO’s office to Hong Kong in 2009.
The government is likely to welcome Gulliver’s u-turn as encouragement to banks to increase their support for British business.
According to people close to him, Gulliver will spend an average of two weeks a month in the UK, a week in Hong Kong and a week travelling to other parts of HSBC’s global operations.
The news contradicts the announcement in September when Gulliver was appointed, which stated the Gulliver would relocate to the principal office of the group chief executive in Hong Kong.
HSBC is still awaiting clearance from the Chinese authorities to go ahead with a stock market listing in Shanghai.
Nine sub-funds launching
Our weekly heads-up for advisers
'Nothing can prevent scammers developing workarounds'
Stalwart Scottish Mortgage takes third place
Consistency and compliance vs. slower reaction time