HSBC

London-based multinational bank HSBC declined to step up scrutiny of its clients in Hong Kong after the US government decided to sanction some high-ranking officials from the Hong Kong Special Administrative Region.

HSBC's move is widely regarded as evidence that the bank remains cautious when it comes to matters relating to the core interests of the Chinese government, especially after pressure grew on the bank following a series of misdeeds against China, industry observers said.

HSBC reportedly has declined to take measures to comply with US government sanctions, reflecting the bank's strong desire to survive in the Chinese market, the observers added.

"We did not make an announcement regarding a review of (our) global clients' accounts, not complying with the orders from some countries including the US," an insider from HSBC told the Global Times on Tuesday. 

The comment came after Bloomberg reported Monday that Citigroup Inc. and Standard Chartered Plc were stepping up their scrutiny of their clients in Hong Kong, indicating that they are anxious about US sanctioning measures.

The US sanctions forbid banks from doing business with the penalized individuals. But complying with that order could put them at odds with the national-security law for Hong Kong which came into effect on June 30. The law stipulates that no sanctions or hostile actions can be applied against the city or China's mainland.

Citigroup Inc. and Standard Chartered Plc could not be reached for comment by Global Times.

Leung Chun-ying, a former top official with the Hong Kong Special Administrative Region (HKSAR) government, said in his latest post on Facebook that the US government sanctions will drive Hong Kong officials to abandon any fantasy toward the US and the UK. "The UK government is not the old boss, and the US government is not an ally. Banks controlled by the UK and the US could sell you out at any time," Leung wrote. 

Hong Kong media quoted HK Legislative Council member Regina Ip Lau Suk-yee as saying that some foreign banks' approach is not surprising. Even before the sanctions were announced by the US government, she said, some US banks operating in Hong Kong were very cautious in handling the accounts of high-profile SAR officials.

A report released by Daiwa Securities said that US sanctions could put the Hong Kong dollar-linked exchange rate mechanism at risk.

Last week the US announced that sanctioned individuals would include Hong Kong Chief Executive Carrie Lam and Xia Baolong, director of the Hong Kong and Macao Affairs Office of China's State Council, saying the officials will have property and assets frozen in the US.

In retaliation, China said Monday that it was sanctioning 11 American politicians, including Senators Marco Rubio and Ted Cruz, and Human Rights Watch Executive Director Kenneth Roth and Michael Abramowitz, the president of Freedom House.

Global Times