HSBC
A man walks past an HSBC branch along a main street in Manila July 1, 2014. A planned law allowing foreign firms to take full control of Philippine lenders is drawing eager suitors to the sector, including Japan's Mitsubishi UFJ Financial Group and Malaysia's CIMB Group Holdings, bankers familiar with the matter say. The Philippine law would replace a cap of 60 percent on foreign ownership and abolish previous rules that allowed just 10 foreign banks in the country. Already passed by Congress, it awaits the approval of President Benigno Aquino, who has flagged this is likely to come soon. Picture taken July 1, 2014. Reuters/Romeo Ranoco

In a bid to focus on Asia, global bank HSBC has moved its chief executive heading the US$500 billion (AU699 billion) fund management from London to Hong Kong. The Asset Management wing operates in 30 locations and has 2,500 employees.

According to reports, the fund boss, Sridhar Chandrasekharan, relocated to Hong Kong from the U.K. base to focus more on Asian operations.

Revenue

HSBC's asset management business attracted US$29 billion (AU$ 40 billion) in net new money in 2014, and funds under management shot up to US$445 billion (AU$622 billion). The division had revenue of US$1.1 billion in 2014, reports Reuters.

Asserting its new focus on Asia, an HSBC spokesman told Sky News that the bank had a “significant client franchise” in Asia.

“As a global asset manager, we believe there are opportunities for us to grow our business with our clients and contribute to the evolution of the investment markets. The global CEO of the asset management business has relocated from London to Hong Kong to directly support this development and will continue to provide oversight across HSBC Global Asset Management's global operations,” the spokesman said.

In June, Stuart Gulliver, HSBC's chief executive, had also spoken about the growing importance of Asia in its asset management business.

“We actually think there isn’t an obviously dominant Asian Asset Manager, so we’re going to relocate the centre of the Asset Management business back to Hong Kong from London, because we think that there’s a very big growth opportunity that comes not just with the Pearl River Delta and ASEAN opportunity but across Asia-Pacific overall,” Gulliver said.

UK policy

HSBC is also mulling about moving its domicile from the U.K. and rebranding its U.K. retail operations. The ring-fencing structure mandated by banks under a new U.K. law binding on all U.K. lenders is one of the factors behind the plan to shift the HSBC headquarters to Asia. Gulliver had openly said restrictions placed on the group directors to exert influence over key decisions at ring-fenced subsidiaries have discomfited HSBC executives.

HSBC said in April that it would undertake the domicile review amidst concerns about the impact of tax and regulatory changes on the operations.

But there was some softening by the government, as George Osborne announced in his July budget that the bank levy, which hit HSBC, would be restructured. But it is still unclear whether HSBC's bill from the bank levy will reduce the impact of its overall tax burden because of a new Corporation Tax surcharge proposed by the Chancellor.

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