HONG KONG (BLOOMBERG) – HSBC Holdings apologised to customers in Hong Kong after an update to its online and mobile banking terms stoked fears over overseas access to its services in the financial hub.
The quick mea culpa by Hong Kong’s biggest bank – triggered by a Twitter post – underscores growing concerns in the city over not only civil society but also pressures on businesses as China tightens its grip.
Banks are trying to navigate an increasingly fraught political environment. The government last week used them as a hammer to shutter the city’s premier pro-democracy newspaper, Apple Daily, ordering seven lenders against dealing with the company. The lenders have not been identified.
Access to funds in the city is becoming a sensitive topic with thousands of Hong Kongers leaving for Britain and other places as freedoms are restricted.
Against that backdrop, the city’s residents were spooked after a Twitter post on Tuesday (June 22) shared a link to updated online and mobile banking terms on HSBC’s website. The bank announced changes to its terms from July 26. It said customers may not be able to use online or mobile banking outside of Hong Kong.
The incident was widely reported by major local newspapers, including Ming Pao, Sing Tao Daily and Hong Kong Economic Times. On LIHKG, one of Hong Kong’s largest online forums, a post on HSBC has more than 800 comments since late on Tuesday, with some people saying they would transfer funds to other banks.
HSBC was quick to reassure customers that there were no changes and that it only had combined terms for its Internet banking, mobile app and mobile security key into one document.
“HSBC Hong Kong customers can continue to access banking services through online banking and mobile banking outside of Hong Kong SAR,” a spokeswoman said, referring to the Special Administrative Region. “There is no plan for any amendment of the services. There are similar cross-border disclosures in other markets.”
The bank also issued a “special announcement” on its mobile app, saying there were no plans to change services.
It is not the first time that HSBC, which counts Hong Kong as its biggest market, has found itself in a hot spot. Late last year, it was forced to freeze the account of exiled former lawmaker Ted Hui, after which chief executive Noel Quinn was called in for questioning by British lawmakers. Mr Quinn, who also reached out to Mr Hui personally to explain, said the bank had no other options than to comply with local regulations.
The lender has also been criticised for publicly endorsing the Beijing-imposed security law and had its branches and main office vandalised during the protests that rocked the city in 2019. Standard Chartered, another big bank operating in the city, also backed the legislation.
“HSBC hasn’t clearly explained why those terms are there, but I believe if Hong Kong customers immigrate overseas, they usually have set up offshore accounts already,” said Dr Law Ka-chung, an economist and adjunct professor at the department of economics and finance at City University of Hong Kong.
Analysts at Bank of America have estimated that emigration-related outflow of money to just Britain could reach HK$280 billion (S$48.6 billion) this year, and HK$588 billion over the next five years.