HSBC braced for grilling over Beijing links by key in­vestors

The Daily Telegraph - Business - - Business - By Lucy Bur­ton

HSBC is pre­par­ing to fend off a bar­rage of ques­tions over its re­la­tion­ship with Beijing when it speaks to in­vestors next week, as bosses fight to stay out of a diplo­matic stand-off with the West.

Europe’s big­gest bank is set for a grilling when it re­ports first-half re­sults on Aug 3. At the week­end, the lender is­sued a state­ment via Chi­nese so­cial me­dia app WeChat deny­ing claims it had tried to frame tele­coms firm Huawei for break­ing US sanc­tions fol­low­ing crit­i­cism in the com­mu­nist regime’s pro­pa­ganda out­lets.

The bank in­sisted it did not “set traps to en­snare Huawei” and had no hos­til­ity to­wards the Chi­nese tech gi­ant, which is be­ing stripped out of 5G tele­coms net­works in the UK over se­cu­rity fears. State-con­trolled Global Times, which has been heav­ily crit­i­cal of the bank, said HSBC’s re­sponse ex­posed the com­pany’s “deathbed strug­gle”.

HSBC has also come un­der at­tack in the West for bow­ing to Chi­nese pres­sure over a se­cu­rity law which for­bids dis­sent in Hong Kong. One ma­jor in­vestor said the bank is likely to be quizzed on re­cent re­ports that its wealth man­agers are ex­am­in­ing whether their Hong Kong clients have ties to the city’s pro-democ­racy move­ment.

The in­vestor said: “That would be very hot if true.”

Ma­jor UK banks will re­port their first-half earn­ings over the next two weeks, start­ing with Bar­clays on Wednesday. John Cronin, a banks an­a­lyst at Good­body, es­ti­mates that Bar­clays, Lloyds and NatWest Group will col­lec­tively take another £4bn hit from coro­n­avirus over the sec­ond quar­ter as the lenders put ex­tra money aside to cover for sour loans, with HSBC and Stan­dard Char­tered each putting aside another £1bn to £2bn.

Newspapers in English

Newspapers from UK

© PressReader. All rights reserved.