LONDON: Proposals from Britain's Independent Commission on Banking (ICB) to ringfence UK retail banking operations are not too restrictive, the chairman of HSBC said on Tuesday.
"It's not as proscriptive as some thought it might be," Douglas Flint told reporters, speaking on the sidelines of the Think Asia/Think Hong Kong business conference.
"They've not gone as far we thought they might have gone at the beginning."
He declined to answer questions as to whether the ICB report would influence HSBC's decision over where its headquarters would be, although the bank had said it intended to keep its head office in London.
On Monday, the ICB proposed a ringfence limiting the extent to which a bank can use money in its retail arm to fund investment banking activities, thus increasing its funding costs.
That will likely hit the profits of British banks and possibly make it harder for them to lend to businesses.
The ICB also laid out tough new capital requirements. Flint said HSBC had to study the detail of how the ICB's proposals would be implemented within its company, but added HSBC was comfortable with the core ringfencing concept.
Copyright Reuters, 2011
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