HSBC delays decision on headquarters move in blow to George Osborne

Chancellor George Osborne’s efforts to keep HSBC’s headquarters in London suffered another setback as Europe’s biggest bank said it was likely to push its deadline for a decision into next year.

The bank has been looking other options including its historic base of Hong Kong, Singapore, the US and even Frankfurt since the board ordered a review in April following investor pressure.

In June it said the results of the review would be announced before the end of the year.

Today chairman Douglas Flint said: “Whilst the target for completion of the review was initially set as by the end of 2015, this is a self-imposed deadline that can be moved should the board require further work to be performed.

“A significant amount of work on this has been carried out but there is still a considerable amount to be done.”

He added that, if necessary, the bank would update investors at its full-year results in late February.

Osborne slashed the UK bank levy in his emergency summer budget, which largely benefited London-based banks with most of their assets overseas like HSBC and Standard Chartered.

Gary Greenwood, analyst at Shore Capital, said: “Proposed changes to the bank levy and a slightly softer stance on ring-fencing by the UK Government has removed some of the pressure to move elsewhere, but it has clearly not been enough to convince management to stay in the UK just yet.”

But Flint said the decision would ultimately be made on the grounds of where HSBC could “maximise present and future opportunities for growth and shareholder value”.

That value fell today as the shares dropped more than 1% despite a reported 32% rise in pre-tax profits to a better-than-expected $6.1 billion (£4 billion) in the third quarter.