HSBC's Hong Kong bankers and the great perk withdrawal: "People had six children"
As the Financial Times has reported, HSBC's Hong Kong bankers are adrift in a new reality. Once, they were the recipients of wildly generous perks. Now they're not. There are suggestions that HSBC might need to hike salaries as a result.
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Until recently, the FT said HSBC offered its senior Hong Kong bankers both $38k school fee subsidies per child and a generous allowance worth up to $25.5k to help them join private members clubs. Both have been discontinued, and starting from 2027 life assurance for future joiners will reportedly be less for existing staff.
The changes are part of an updated benefits framework for employees at HSBC and Hang Seng Bank that will begin in January. Most staff at the two banks will be unaffected. The big perks will only disappear at director level and above.
Reminiscing about the generous days past, one former HSBC managing director (MD) in Hong Kong, told us the higher perks were historically higher there to compensate for lower pay. "Salaries at HSBC were 10-15% lower than anywhere else, but they offered the best deal on club memberships in town," he said.
HSBC didn't comment on its historic pay. Last year, the bank paid its material risk takers - typically its most senior people - an average globally of $1.4m, putting it on a par with US banks. The pay differential may therefore have narrowed.
Existing employees at director level and above at HSBC in Hong Kong will continue to receive the US$38k school fee supplement, which will only be removed for new joiners from next year. This is fortunate as some Hong Kong bankers are understood to have had large families. "People had five or six children," said the ex-MD.
The removal of the US$25.5k club membership subsidy does not mean that HSBC's Hong Kong bankers will be meeting clients in Starbucks. The subsidy reportedly applied only to clubs that weren't whitelisted on HSBC's corporate membership list. This list is understood to include the likes of the Hong Kong Jockey Club and The American Club, so bankers will still be found in these hostelries.
It's not clear whether HSBC is also restricting access to the apartments it allegedly owns on the Peak and that are available as accommodation for very senior staff. The bank owns a mansion called Taipan House on the Peak. Until recently, this was occupied by Peter Wong, HSBC's chief executive for Asia, who retired in 2021. Last year, Wong was said to buy a US$16m apartment in Hong Kong's Southern District, so the mansion may now be available again.
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