HSBC group chief executive reiterating the bank’s commitment to stay global despite recent controversial challenges such as the Huawei court case or the national security law in Hong Kong.
«Our clients still want to be international. They still have needs on a global basis and they’re asking us to help them with those global needs,» said HSBC’s Noel Quinn in the opening keynote session of the Sibos 2021 conference.
«My job is to help this organization navigate those geopolitics, be very focused on helping our clients navigate their business model needs and remaining focused on the long-term, not just the short-term.»
Complex World
HSBC has been embroiled in various geopolitical challenges in recent years, especially in China, such as the arrest of the now freed chief financial officer of Huawei Technologies Meng Wanzhou or the implementation of the national security law in Hong Kong.
«If you’re an international bank and you want to be global, it’s a fact of life that you have to comply and operate within a complex geopolitical world. It’s particularly complex at this point in time.»
Sanctions Risk
In August, Hong Kong breathed a sigh of relief as Chinese authorities unexpectedly shelved its anti-sanctions law for the city which would force financial institutions in some cases to choose between violating rules by Washington or Beijing.
In the run-up to the decision, there were numerous reports of banks considering potential relocation in order to manage compliance risk.
«Sanctions are a matter of government policies,» Quinn chuckled when asked about whether governments engage the bank in any related dialogue beforehand or if he learns about developments via news. «We’re not consulted on that, but we have an obligation to comply.»
Sustainable Finance
On sustainability, Quinn said the bank’s preference will be placed on financing the transition rather than simply withdrawing from certain industries like fossil fuels.
«I’ve given commitment about my balance sheet and how it will look in 2050,» he said, referring to HSBC’s pledge to reduce financed emissions to net-zero.
«In the event that you’re having a dialogue with somebody that is reluctant to go in that direction, of course, you’ve got to reserve that option of moving away from that particular client if they’re not willing to go down the sustainability path. You don’t start there.»
Digital Currencies
And on digital currencies, Quinn said he is «keen on being part of the journey» but he underlines two criteria.
Firstly, is transparency and the bank’s ability to identify counterparties for financial crime compliance. Secondly, is convertibility which Quinn explained as a focus on suitability and potential conduct issues related to client appetite for volatility.
«I look at digital currencies, not through a fixed lens, but I want to understand how those digital currencies are going to operate on those two attributes.»
