HSBC branded Britain’s most secretive bank by study
HSBC has been accused of being Britain’s most secretive big bank.
In a report published ahead of the bank’s annual meeting with shareholders on Friday, charity Christian Aid said the scandal hit lender is ‘hiding far too much about its global activities’.
While it stressed it is not suggesting HSBC is doing anything illegal, it said the bank’s lack of clarity makes it difficult to know whether it is paying the right amount of tax in different jurisdictions.
The comments are particularly sensitive for HSBC, which is likely to be grilled by investors on Friday over claims its Swiss private banking arm helped wealthy clients evade tax in the middle of the last decade.
Major investors are understood to be concerned about corporate governance at the bank, and want HSBC to replace veteran chairman Douglas Flint, pictured, with someone from outside the organisation.
Rona Fairhead, the BBC Trust chairman and a long-standing HSBC board director, has come under pressure to step down from both positions as the scandal occurred under her watch.
The criticism of HSBC’s transparency from Christian Aid is based on the country-by-- country reports filed by the big four banks: Barclays, Lloyds, Royal Bank of Scotland and HSBC.
These disclose information such as the number each bank employs in a particular country, its turnover and the amount of tax it paid. Christian Aid said Barclays is the most transparent.
But it said HSBC’s country-by-country report does not live up to its name because most of the 74 countries and territories it operates in are not included. Instead they are lumped together as ‘other’.
It said that HSBC places £3.8bn – or 8.9pc of its turnover – in the ‘other’ category, compared with just over 1pc for Barclays and RBS and 0.06pc for Lloyds. John Stead from Christian Aid said this ‘averages out at roughly £67m per country that is unreported, making HSBC unaccountable in these territories’.
HSBC said it had a ‘commitment to openness and transparency in reporting’.