London Daily

Focus on the big picture.
Saturday, Sep 12, 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
Chinese Crypto Entrepreneur Leon Li Identified as Seller of £190 Million London Mansion
Trades Union Congress Proposes Social Energy Tariff Funded by Higher Bank Surcharge
British Chambers of Commerce Calls for State Pension Triple Lock to Be Scrapped
Anthropic Says Claude Helped Disrupt Biological Weapons and Cyber Espionage Threats
UK Imposes Sanctions Over Israeli Settlements and West Bank Violence
UK Reimposes Sectoral Sanctions on Iran’s Aviation, Shipping and Energy Networks
UK Economy Grows 0.4% in July as AI and Programming Services Lift Activity
UK House of Commons Rejects Assisted Dying Bill by 286 Votes to 270
UK Reviews Nationwide Emergency Alert Tests After Systems Meet Reliability Targets
UK Seeks Faster Rail Links Across Northern Industrial Corridors
British Business Bank Allocates £150 Million for High-Growth Companies in Northern England
BBC Warns Staff Strikes Are Possible Amid Pay Dispute and £500 Million Savings Drive
UK Backs Short Extension of UN Sudan Sanctions Regime
Prime Minister Andy Burnham Defends Early Prison Release Reforms and Growth Strategy
Reform UK Faces Scrutiny Over Alleged Effort to Circumvent Foreign Donation Rules
UK Analysts Warn Tax Rises or Spending Cuts May Be Needed to Preserve Fiscal Headroom
Jaguar Land Rover Plans Up to 4,000 Job Cuts in £1.7 Billion Cost-Saving Drive
UK Chancellor Warns of Difficult October Budget as Borrowing Costs Rise
UK Declares Israeli Occupation of West Bank Unlawful and Expands Sanctions
UK House of Commons Rejects Assisted Dying Bill for England and Wales
English Councils to Gain Power to Introduce Tourist Taxes by 2028
Kemi Badenoch Reshuffles Conservative Shadow Cabinet
Firefighters Make Progress Containing Major Wildfires in South Wales
John Lewis Partnership Reports £124 Million Loss
Study Says UK AI Data Centres Will Create Only a Quarter of Forecast Jobs
UK Government Considers Higher Industrial Water Prices Amid Supply Pressures
Andy Burnham Holds First Call With Donald Trump as UK Prime Minister
NHS Records Busiest Summer on Record as Heatwaves Drive Hospital Admissions
Home Secretary Orders Police Crackdown on Far-Right Anti-Migrant Vigilantes
UK Supreme Court Rules Northern Ireland Religious Education Curriculum Breaches Human Rights Standards
Markets Price in Four Bank of England Rate Rises by Next Summer
House of Commons Prepares Free Vote on Assisted Dying Bill
UK Government Bans Trade With Israeli Settlements in Occupied Territories
UK Economy Grows 0.4% in July as Artificial Intelligence Investment Supports Expansion
Andy Burnham Becomes UK Prime Minister After Keir Starmer Resigns
John Lewis Partnership Loss Widens to £124 Million
UK Government to Put White Working-Class Social Mobility at Centre of Equality Policy
McLaren Plans £450 Million Technology Investment Creating 1,000 UK Jobs
UK Chancellor Faces Calls for Wealth Taxes and Public Ownership in Autumn Budget
English Mayors to Gain Powers to Impose Uncapped Overnight Tourist Taxes
JPMorgan’s Jamie Dimon Warns UK Government Against Bank Windfall Taxes
UK Air Traffic Control Outage Cancels More Than 2,000 Flights
UK Imposes Trade Ban on Israeli Settlements in the West Bank
UK Borrowing Costs Surge as Middle East Tensions Push Long-Term Gilt Yields to Highest Since 1998
Buckingham Palace Says Prince Harry and Meghan Will Not Resume Official Royal Duties
UK Treasury Faces Calls to Scrap £100,000 Childcare Support Threshold
Trades Union Congress Urges Labour Government to Rewrite Migration Policy
Riot Police Deployed After Anti-Migrant Protests Turn Violent in Portsmouth
UK Considers Replacing Some Disability Cash Payments With Direct Services
JPMorgan’s Jamie Dimon Warns UK Chancellor Against Higher Banking Taxes
×