Hong Kong: HSBC and Stanchart shares rise after backing China security law
HSBC and Stanchart have both seen their shares rise after backing controversial new security laws China plans to impose on Hong Kong, despite the UK’s opposition.
Both banks have said the law could uphold stability in the long-term in Hong Kong, where protests have sparked again despite the risk of coronavirus over China’s encroachment.
HSBC Asia Pacific chief executive Peter Wong yesterday signed a petition backing the new law, which would make secession and undermining the government’s authority a criminal act.
But Japanese bank Nomura said it was “seriously” considering its presence in Hong Kong.
Hong Kong citizens first protested last year to force the city to bin a planned law that could see China extradite people to face trial. Now observers fear China’s new security laws could end Hong Kong’s unique freedoms.
HSBC, which moved its headquarters to the UK in 1993, said the Hong Kong Association of Banks had already said the law would maintain a stable business environment.
Standard Chartered added: “We believe the national security law can help maintain the long-term economic and social stability of Hong Kong.”
HSBC shares rose 1.6 per cent while StanChart jumped 2.3 per cent, against a 0.1 per cent decline on the Hang Seng index.
Stanchart said “the ‘one country, two systems’ principle is core to the future success of Hong Kong and has always been the bedrock of the business community’s confidence”.
However, Nomura boss Kentaro Okuda told the FT Hong Kong was “not the same as it used to be”.
Hong Kong citizens fear the new security laws could affect free speech and their right to protest, which China would classify as subversion.
There are also fears China could create its own law enforcement agencies in Hong Kong.
Both HSBC and Stanchart’s shares rose today after backing the new laws.
“The U.S. no longer considers Hong Kong autonomous from China and there are risks that HSBC becomes a political football after Peter Wong’s declaration of support for the new national security law,” Will Howlett, analyst at HSBC shareholder Quilter Cheviot, told Reuters.
“Does HSBC feel compelled to weigh in on other laws in other countries? We have watched over the past week China clearly assert pressure on businesses and other actors to show their support for the law to create the illusion of support,” added Sophie Richardson, China director for Human Rights Watch.