Where Next for Standard Chartered and HSBC

Bill Winters, CEO Standard Chartered

Bill Winters, CEO Standard Chartered

Both HSBC and Standard Chartered generate substantial revenues from Asia, but have stubbornly rooted their headquarters in London. Post Brexit will they now rethink their domiciles?

Singapore’s sovereign wealth fund Temasek, a major shareholder in Standard Chartered, will no doubt be keeping a close watch on its many multi billion dollar British based investments.

Late last year the wealth fund said it was willing to give Standard Chartered CEO Bill Winters time to work on the turnaround before deciding on the fate of its underachieving $4 billion stake in the bank as part of a portfolio reshuffle.

DBS to Acquire Standard Chartered

But now with huge uncertainty swirling around the direction of the U.K. as a leading financial hub will Temasek decide to sell down its Standard Chartered holdings in favour of those it also owns closer to home such as DBS, China Construction Bank, Bank of China or Industrial and Commercial Bank of China.

Could one practical solution be for DBS to make a bid for Standard Chartered to build a Singapore based global banking player?  

Domicile Dilema

Earlier this year Douglas Flint, the chairman of HSBC, mocked the possibility of relocating the bank’s headquarters back to Hong Kong. No doubt his closest aides had whispered to him, at that time, that the UK would overwhelmingly vote to remain in the European Union.

In August 2015 Standard Chartered, also quashed rumors of relocating away from London .

Share Prices 

Last week the Capgemini «World Wealth Report» confirmed that the growth region in the world is the Asia-Pacific and this region will remain the wealth growth driver for decades to come.

If it becomes clear that a prolonged weakening in share prices is the result of the Brexit vote, will these banks swallow their hubris and relocate their headquarters to Asia?


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