Investors in Asia-focused banks Standard Chartered as well HSBC have encouraged the banks to consider switching its domicile away from London following the chancellor’s decision to increase the UK bank levy by a third.
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One of the investors in Standard Chartered said: "The increase in the bank levy may make it sensible to move. We want the company to look at this. Moving headquarters is not easy and it may not be worth it, but this should be considered."
The increase in bank levy will render StanChart to face paying about $500m under tax or 9% of expected profits while HSBC may need to pay $1.5bn or 7% of expected profits.
StanChart paid $366m towards the UK bank levy in 2014, an increase of more than 50% on the previous year, and HSBC paid an amount of $1.1bn, up from $904m in 2013.
A top 20 investor StanChart bank said: "This is a big hit for Standard Chartered. The bank would need to weigh up how much it would cost to switch domiciles, but it is looking more like a possible option."
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By GlobalData
