The HSBC logo is displayed outside the bank's headquarters in Hong Kong. The bank said a report that the CEO Stuart Gulliver had dropped plans to base in Asia was "entirely incorrect". Jerome Favre / Bloomberg

But the new chief is expected to spend much of his time in London

HSBC Holdings Plc's new chief executive's main office will remain in Hong Kong after the symbolic shift of the CEO office there last year, Europe's biggest bank said on Tuesday.

Stuart Gulliver, who became CEO in January, will retain an office in London and is expected to spend much of his time at HSBC's London headquarters. However the bank said a report he had dropped plans to be based in Asia was "entirely incorrect".

"The group CEO's principal office remains in Hong Kong, there's no change in that," said Richard Beck, spokesman for the bank.

Gulliver was named CEO in September after a shock boardroom upheaval prompted by a change in chairman, and said at that time he would be based in Hong Kong.

Previous CEO Michael Geoghegan announced he was moving to Hong Kong with much fanfare a year ago. On his first official day as CEO entering the stylish Norman Foster-designed HSBC building in the city's Central district he was greeted by dozens of applauding employees.

The moment was rich in symbolism, showing the 146-year-old bank was returning to its roots, where it was originally known as the Hongkong and Shanghai Banking Corp Ltd.

HSBC aims to be the first firm listed on Shanghai's international board, and the CEO's move to Hong Kong and Gulliver's close ties to the mainland are expected to help that happen this year.

Gulliver, who ran the investment bank arm from London before his promotion to CEO, joined HSBC in 1980 and has permanent Hong Kong residency after spending most of his career there.

The bank said Gulliver will spend as much time in Hong Kong as anywhere else in the world and will move back into the HSBC house he previously occupied in Hong Kong, rather than the house occupied by Geoghegan.

He is expected to spend much of his time in London, and as a result continue to pay UK income tax.

Tuesday's Financial Times said Gulliver had dropped plans to relocate to Hong Kong.

Analysts said the location of the CEO's office was symbolic, but had little bearing on a strategy that is increasingly focused on fast-growing Asian markets.

Ian Gordon, analyst at Exane BNP Paribas, said HSBC was showing a "new found appetite to accelerate loan growth" in Hong Kong and Asia and Geoghegan's move had been accompanied by a "bizarre wave of enthusiasm".

Bloomberg

(HK Edition 01/26/2011 page3)