London Daily

Focus on the big picture.
Saturday, Mar 14, 2026

Hong Kong Banking Giants Defy Dire Predictions Amid Protests

Hong Kong Banking Giants Defy Dire Predictions Amid Protests

HSBC, Standard Chartered earned more from city despite unrest; ‘It would take a huge structural change’ to upend hub’s status

There may be protests, wafts of tear gas and the occasional burning Starbucks along the street, but inside Hong Kong’s biggest financial firms the outlook for business is surprisingly status quo.

That was the takeaway this week as two banking giants in Hong Kong -- HSBC Holdings Plc and Standard Chartered Plc -- posted quarterly results that showed business there held up despite civil unrest. Now, one of the top experts on the financial hub is weighing in with his evaluation: Don’t expect the city to lose any stature among global markets.

“It would take a huge structural change,” for Hong Kong to cede its position as a financial center, K.C. Chan, the city’s former secretary for financial services and the treasury, said in an interview. “That’s not what I see today. The reason Hong Kong’s financial markets are doing so well is because they have been serving China’s economy. Has this changed? No.”

Demonstrations led by pro-democracy activists have indeed disrupted local commerce and discouraged tourism, tipping the city toward a technical recession. Then there are more dire predictions: The unrest could prompt investors to move their wealth to rival hubs such as Singapore or lead major financial firms to rethink their presence in town.

But the votes of confidence by Chan and executives atop major banks in recent days underscored Hong Kong’s unique position as China’s gateway to international markets. The city’s regulatory framework and laws, the argument goes, make it the indispensable venue for companies in the world’s second-largest economy to tap capital from abroad.

That, in turn, has generated wealth in the city, drawing legions of private bankers and money managers to tend it.

“If you have your liquidity here in Hong Kong, you won’t just move your money to Singapore in a flick,” Chan said.

Contingency Plans

Few global companies have tied their fortunes as much to Hong Kong as London-based HSBC. When the firm posted third-quarter results Monday, it described operations in Asia as resilient. Adjusted pretax profit from Hong Kong, the bank noted, climbed 1% in the quarter to $3 billion.

Still, HSBC took a $90 million credit charge because of the dimming outlook for the local economy, where small- and medium-sized businesses in particular are suffering. And on Thursday it lowered its best lending rate in the city for the first time in more than a decade, a move that the lender said should help the local economy and companies.

Some ultra-wealthy clients are drawing contingency plans for parking cash elsewhere, the company said, but very little has actually moved. Across the city, there hasn’t been significant capital outflow, Hong Kong Monetary Authority Chief Executive Eddie Yue added at a briefing on Thursday.

Standard Chartered said it earned more in Hong Kong, too.

“Business is actually continuing to perform pretty well,” Chief Financial Officer Andy Halford told Bloomberg Television on Wednesday, referring to the city. “Maybe not growing quite as much as it’d have done previously, but absolutely still growing.”

Some clients, he acknowledged, have explored whether to set up additional accounts elsewhere. For now, the number of people doing it isn’t large, he said. And even if they shift money, the bank can just serve them from other locations.

To be sure, the situation is much starker for local banks, especially those catering to the residents and small businesses. Declines in home prices, office rents and the retail sector threaten to increase credit costs. Potential capital outflow and the monetary authority’s intervention could squeeze net interest margins.

A stress test performed by analysts at JPMorgan Chase & Co. estimated lenders such as Hang Seng Bank Co. and Bank of East Asia Ltd. could see earnings slump 24% to 45% next year and 39% to 67% in 2021.

Others suggest things will snap back to normal.

“If you look back in history there have ebbs and flows in Hong Kong and it has a proven track record of resiliently coming through difficult situations,” Standard Chartered’s Halford said. “It is a very vibrant economy. It has got a huge reputation. Our hope and our belief is that over a period of time it will plow through this.”

Newsletter

Related Articles

0:00
0:00
Close
Middle East War Highlights Strategic Importance of Strong UK–Ireland Cooperation
Weak Growth Signals UK Economy Was Faltering Even Before Middle East Energy Shock
Marks & Spencer Tops UK Fashion Retail Rankings as Most Considered Brand
United States Launches Trade Investigation Into Allies Over Forced Labour Practices
United States Launches Trade Investigation Into Allies Over Forced Labour Practices
Russia Accuses Britain Over Storm Shadow Strike as London Reaffirms Ukraine’s Right to Self-Defence
Russia Accuses Britain Over Storm Shadow Strike as London Reaffirms Ukraine’s Right to Self-Defence
Royal Navy to Acquire Twenty Uncrewed Surface Vessels for Autonomous Warfare Testing
Russia Summons British and French Envoys After Ukrainian Storm Shadow Strike on Strategic Facility
Starmer Confirms Britain Will Maintain Sanctions on Russia Despite U.S. Policy Shift
UK Moves to Refine AI Definition in Investment Security Reform
UK Economy Stalls in January as Growth Unexpectedly Falls to Zero
Asian Energy Security Tested as Strait of Hormuz Disruption Threatens Oil Supplies
Iran Sets Three Conditions for Ending Regional War as Diplomatic Efforts Intensify
Tesla Secures Approval to Supply Electricity Directly to Homes Across Britain
Prince William Delivers Tribute to Australia’s Naval Alliance Amid Renewed Royal Spotlight on the Country
UK Foreign Secretary Travels to Saudi Arabia to Reinforce Support for Regional Allies
Putin’s ‘Hidden Hand’ May Be Assisting Iran in Conflict With Trump, UK Defence Secretary Warns
UK Sets April Deadline for Tech Platforms to Strengthen Online Protections for Children
Elon Musk Moves Into Britain’s Energy Market as Tesla Wins Licence to Supply Power
UK Watchdog Warns Fuel Retailers Against Profiteering Amid Iran War Price Surge
Report Claims Iran Used UK Charity Network to Expand Influence
United States and United Kingdom Establish Joint Standards for Counter-Drone Technology
Iran May Be Laying Naval Mines in Strait of Hormuz, UK Warns Amid Escalating Gulf Tensions
US Deploys Bunker-Buster Bombs to UK Airbase as Iran Conflict Intensifies
British Troops in Iraq Intercept Iranian Drones Targeting Coalition Base
Release of Mandelson Files Raises Tensions as UK Seeks Stable Relations With Donald Trump
UK Documents Reveal Starmer Was Warned About Mandelson’s Epstein Links Before Ambassador Appointment
Nearly Five Hundred UK Mortgage Deals Withdrawn in Two Days as Market Volatility Forces Lenders to Reprice
Three Cargo Ships Hit Near Iran as Attacks Spread to Strategic Strait of Hormuz
Why British Police Repeatedly Declined to Investigate Jeffrey Epstein’s UK Links
UK Parliament Ends Hereditary Seats in House of Lords, Closing Chapter on Centuries of Aristocratic Lawmaking
EU and UK Urge Israel to Act Against Rising West Bank Settler Violence Amid Regional Tensions
US Senator John Kennedy Says Keir Starmer Should Not Be Trusted for Military Advice Amid Iran War Debate
UK High Court Rejects Attempt to Revive Terrorism Charge Against Kneecap Rapper
Revolut Secures Full UK Banking Licence After Multi-Year Regulatory Wait
Kentucky’s Bench Boost Powers Wildcats Past LSU in SEC Tournament Opener
British Couple Die After Being Pulled From Water at Australian Beach During Family Visit
Global Energy Agency Announces Record Release of 400 Million Barrels to Stabilize Oil Markets Amid Hormuz Disruption
British Airways Suspends UK Repatriation Flights as Middle East Travel Disruption Deepens
US Forces Prepare Ordnance at RAF Fairford as Strategic Bombers Deploy for Middle East Operations
Nigel Farage Faces Criticism After Saying Britain Should Stay Out of Iran War
Landmark UK Trial Begins Over Sony’s PlayStation Store Pricing
UK High Court Rejects Bid to Challenge Britain’s Chagos Islands Agreement With Mauritius
Finnish Duo Triumphs in England’s Annual Wife-Carrying Race, Winning a Barrel of Ale
How U.S. and UK National Security Strategies Are Reshaping the Global Business Landscape
Green Party Gains Momentum as Labour Shifts Toward the Political Centre
Royal Navy Destroyer HMS Dragon Sets Sail for Eastern Mediterranean as Regional Tensions Rise
UK Homebuilder Persimmon Warns Iran Conflict Could Dent Property Buyer Confidence
Roman Abramovich Signals Legal Fight if UK Seeks to Seize Chelsea Sale Funds
×