The high tax charge from the bank levy is a key factor, as is the cost of splitting the UK retail bank away from the rest of the business under the new ring fence rules.
The bank levy is a tax of 0.5 per cent on UK-based banks’ global balance sheets, hitting HSBC harder than the other large UK lenders, and putting it at a competitive disadvantage to global rivals.
“HSBC’s $1.2bn (£792m) potential levy is now more than a third of the total and rising. With the chancellor recently stating the levy is permanent, the cost of moving HSBC’s headquarters out of the UK declines in relative size,” analyst Alastair Ryan said in a note to clients. “We believe a move would be a several-billion dollar challenge but potentially one the market could reward the group incurring.”