HK Growth Prospects Mired In Geopolitics, Says HSBC

HSBC said on Tuesday that it is assessing the impact of US sanctions on Hong Kong entities and individuals on its business, as it warned of heightened geopolitical risks to its growth prospects and profitability in the SAR.

The Asia-focused British bank reported that its pre-tax profit for the July to September period from Hong Kong was down 37 percent on-year, and 15.5 percent on-quarter, at US$1.9 billion.

The bank highlighted in its earnings report that it was monitoring and assessing the impact of ongoing developments on US sanctions as a result of Beijing's national security law in Hong Kong.

The bank pointed out that Washington may identify more individuals or entities for sanctions, after it earlier announced a list of 11 people for sanctions under the Hong Kong Autonomy Act.

The US government accused Chief Executive Carrie Lam and the 10 other top officials of undermining Hong Kong’s autonomy.

HSBC warned that the ongoing Sino-US tensions could result in an "increasingly fragmented trade and regulatory environment", when investor and business sentiment in some sectors is already subdued.

But it said that the financial services sector in Hong Kong has benefited from stable liquidity conditions and remains strong.