A MAJOR investor in British banks has slammed the Independent Commission on Banking (ICB) as “completely unnecessary” and likely to drive HSBC and Standard Chartered to Asia.
Speaking during a web-conference, Schroders’ head of UK equities Richard Buxton (pictured), who manages a £2.9bn UK fund, said: “On a three-year time horizon, is it extremely likely it will encourage HSBC and Standard Chartered to switch domicile.
“They may not necessarily lose their London listings but, in terms of the UK shooting its economy in the foot by losing tax revenues, it is hardly a sensible idea. This will be poor news for the UK economy,” he added, calling the ICB’s £4-7bn cost estimate of the ring-fence proposal “nonsense”.
He also warned that a ring-fence could exacerbate financial instability during a crisis by encouraging “deposit flight” from non-ring-fenced banks. And he said that many of the ICB’s other proposals were already being introduced.
As City A.M. revealed recently, Hong Kong is sparing no effort to woo HSBC.