HSBC and StanChart voice support for China's Hong Kong security law
A market analyst warns the banks risk becoming political footballs as China seeks backing for its new national security law.
Thursday 4 June 2020 07:26, UK
UK-based HSBC and Standard Chartered banks have seen a rise in their share prices in Hong Kong after the pair publicly supported China's controversial new national security law covering the territory.
The banks had come under pressure from China's state-backed media to back the measures - condemned by pro-democracy and union movements in the former British colony along with the UK and most western governments.
Their statements were widely seen as a move to protect their interests in Hong Kong after remaining largely silent during, often violent, protests against Chinese control that began last year.
Critics of the new law, which is still being drafted, fear it could be used to diminish Hong Kong's traditional freedoms of the press, of speech and of protest.
HSBC's Asia-Pacific chief executive, Peter Wong, signed a petition backing the implementation of the new law.
The bank said in a post on social media in China: HSBC "respects and supports all laws that stabilise Hong Kong's social order".
StanChart later said it believed the law can "help maintain the long term economic and social stability of Hong Kong".
While both banks are UK based, with dual listings in London, Hong Kong is their biggest single market.
They later faced a swell of criticism from human rights groups, with Will Howlett, analyst at HSBC shareholder Quilter Cheviot, noting: "There are risks that HSBC becomes a political football after Peter Wong's declaration of support for the new national security law."
However, Hao Hong, Hong Kong-based head of research at brokerage BOCOM International, told the Reuters news agency: "Investors should welcome these statements.
"It could get sh**** if you are in the city and don't support the law."
Hong Kong-traded HSBC stock was more than 1.5% higher in afternoon trading, while StanChart shares were over 2% up.
Britain has called the law "authoritarian" and said it is in breach of the "one country, two systems" principle enshrined in the 1984 Sino-British Joint Declaration.
Boris Johnson has pledged to allow nearly three million Hong Kong citizens the right to live and work indefinitely in the UK, with a route to full citizenship, if China imposes the measures.