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Local ties make case for HSBC to come home

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Why you can trust SCMP
Enoch Yiu

With HSBC Holdings' mega rights issue supported by many Hong Kong investors, maybe it is time for the giant lender to think about moving its headquarters back to the city.

Many high-profile investors, such as 'Mr Lan Kwai Fong' Allan Zeman and Hong Kong's oldest broker David Tung Wai, who have been holding the bank's stock for 30 years have immediately backed the rights issue.

And so have the richest men in town, such as Li Ka-shing, Lee Shau-kee and Cheng Yu-tung, who have agreed to be sub-underwriters for the rights issue.

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Scores of more humble investors have also shown loyalty, including waiters, hairdressers and hawkers. The list includes many organisations that have held the stock for decades and rely on its dividends to enhance their performance.

Tellingly, this strong emotional bond was not seen in the rights issue late last year of Standard Chartered, another British lender with strong ties with Hong Kong.

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This is so because many Hong Kong people still believe HSBC is a homegrown success story even though it moved its headquarters to London in 1993 and made Hong Kong only its Asia-Pacific head office.

While experts warn investors not to fall in love with their investments, many Hongkongers are still 'madly and deeply' involved with the lender. To many, they have been married to the bank stock for such a long time that divorce is unthinkable.

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