Bank feels heat over account tied to protestTop News | Kevin Xu and Bloomberg 19 Nov 2019
HSBC found itself in hot water over politically sensitive issues after it was reported that the firm is shutting a corporate account which had helped protest-related crowdfunding funds to receive donations, a departure from the stated purpose of the account.
A spokesperson of the bank denied that any related accounts had been immediately frozen.
The bank informed the corporate client last month and had given it a notice period of thirty days, which will be due this week, the report said.
The spokesperson said an account might be closed if it turns out that its transaction activities do not correspond to its stated purposes.
If the bank spots any transaction activities which are inconsistent with the stated purpose of the account, or missing information, it will review the accounts' activities, which can result in account closure, the spokesperson said.
Hong Kong's polarizing protests have created headaches for companies - including Apple and Activision Blizzard - that have come under heavy political pressure to cut any perceived ties with the anti-government movement - only to later face public backlash.
In pointing to well-established banking regulations, HSBC may show it had no discretion in the account's closing and that it is not because of politics.
Another organization, 612 Humanitarian Relief Fund, which helps protesters pay medical expenses and legal fees, said on Facebook yesterday that its HSBC account is running normally.
Few global companies have tied their fortunes as closely to Hong Kong as London-based HSBC, which keeps pressure on the bank to maintain its standing with local residents.
The firm drew more than 35 percent of its adjusted revenue from Hong Kong during this year's first nine months. When reporting results in October, it said business there was proving resilient despite the turmoil.
Banks are required to "effectively assess risk" regarding account activity, ensuring the consistency of their stated purpose and source of funding, the Hong Kong Monetary Authority said.