HSBC pledged to decide whether to leave the UK within months on Tuesday as its chief executive said Britain had rejected the universal banking model that Europe’s largest bank aspires to.
Stuart Gulliver, the bank’s chief executive, hit out against the chancellor’s bank levy, warning it would end his efforts to increase dividend payments to shareholders.
Stuart Gulliver also conceded the bank’s reputation has been damaged and the morale of senior staff knocked by the revelations about the tax evasion strategies adopted by its Swiss arm.
Mr Gulliver outlined a range of frustrations with being subject to British rule, and said Hong Kong’s banking regulator would be perfectly capable of supervising HSBC.
Speaking after HSBC defied expectations to report an increase in first-quarter profits, he said Labour’s plans to raise the bank levy would make it “impossible” for the bank to progressively increase its dividend.
Ed Balls has proposed raising the bank levy – a deeply unpopular tax on balance sheets – above the 0.21pc that George Osborne increased it to during March’s Budget.
This would see HSBC pay $2.4bn (£1.6bn) a year on a tax that did not exist in 2010, when the bank last considered where to headquarter itself.
“That’s going to make it impossible to stick with our pledge to progressively raise the dividend,” Mr Gulliver said.
Last month, the bank unleashed a political storm when it announced it was reviewing its London head office, where it has been based since 1992 after buying Midland bank.
Gulliver’s latest remarks, less than 48 hours before polling day, may help reignite the row.