HSBC takes heat from all sides after supporting China to Hong Kong

US Secretary of State Mike Pompeo said on Tuesday, HSBC (HBCYF) He would not earn bank respect in Beijing, saying “institutional kowtows” because it supports the law. Critics are afraid that the law will wear down the autonomy that Hong Kong promised when the former British colony returned to China more than 20 years ago.
Pompeo is the latest politician accumulated at HSBC after posting a photo in the Chinese social media last week showing that Asia Pacific CEO Peter Wong signed a petition supporting the law. Tom Tugendhat, head of the British Parliamentary Foreign Affairs Committee, is among British lawmakers Questioned HSBC’s decision.
The investors of the bank are also starting to weigh. David Cumming, stock trader for Aviva Investors, HSBC’s shareholder, said on Wednesday that we are “restless” in the decisions of HSBC and UK-based lenders. Standard Chartered (SCBFF) to support the law without knowing how to work in practice.

“If companies make political statements, they must accept the following corporate responsibilities,” Cumming said. Said.

Even before Wong’s photo was published, HSBC faced a difficult situation. Former Hong Kong leader Leung Chun-Ying had previously chosen the bank for silence in the law, demanding that HSBC express its support.

HSBC publicly supports Standard Chartered China's national security law for Hong Kong
And now that the bank has taken a stand, it still doesn’t seem to be winning Beijing. China’s state-run tabloid Global Times He accused the bank of “a vague attitude against Hong Kong’s national security law” on Tuesday, and a long-standing accusation in China is against HSBC’s chief financial officer, Huawei’s chief financial officer, Meng Wanzhou. said he helped him open it.
Is meng under house arrest Awaits a decision on whether to return to the US on charges of bank fraud in Canada and avoiding economic sanctions against Iran. US officials claim that the Chinese technology firm misrepresented itself to HSBC as part of this plan – Huawei’s rejection claim. HSBC told Reuters last year, informing the authorities “upon official request. “
HSBC “can now face a worse dilemma than being safe from retaliation.” Global Times reportedhe speaks of “some observers”.

Even Pompeo stated that HSBC is still facing a cold welcome in China.

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“This spectacle show seems to have little respect for HSBC in Beijing, which continues to use the Chinese bank’s business as a political leverage,” the Chinese Communist Party said as a warning story about “browsing” HSBC. ” Said. “

On Wednesday, a spokesperson for the Chinese Foreign Ministry said that everyone “has the right to make merit-based independent decisions”.

“For some in the U.S., perhaps the world lies in just two categories – either they’re with the U.S. and they have to attack China,” Hua Chunying said in response to a question about Pompeo’s statement. “These views are narrow-minded and absurd.”

The attacks are a major headache for HSBC, which started more than 150 years ago as Hongkong and Shanghai Banking Corporation to finance trade between Asia and Europe. The bank still has an important commercial asset in the region: Last year, the Hong Kong and Chinese divisions drew enough money to eliminate losses in the UK and keep the company profitable.

HSBC declined to comment. The bank’s shares traded in Hong Kong closed 1.5% on Wednesday.

A pedestrian crossing HSBC in Hong Kong in 2017.

As a British business, the bank faces the risk of collateral damage between the UK and China.

For example, Huawei’s Trying to convince the British government I believe the country can help build the 5G network. Lam said that if Huawei’s progress was rejected by British regulators, China could retaliate by punishing HSBC. The bank also has rumors that it has been on a list for a long time. “unreliable” foreign companies China could have been blacklisted.

“It is not surprising that the Chinese have settled in HSBC as a target,” Lam said. Said.

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According to Lam, Washington is “trying to form an allied coalition” against Beijing. He said that Pompeo’s decision to call HSBC reflects “severe” tensions, especially between the US and China.

Lam said HSBC’s prediction is now similar to the political fire storm that has closed the Hong Kong flagship airline. Cathay Pacific (CPCAY). Some staff participated in anti-government protests Last year, the city angered Beijing. And airline Took steps to surrender to Chinese officialsTwo of the top executives eventually resigned.

– Eoin McSweeney, Isaac Yee and Jennifer Hansler contributed to this report.

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