American banking giant Wells Fargo is reportedly planning to shift its Asian regional hub to Singapore from Hong Kong, which has witnessed months of unabated political protests.
The is part of the bank’s wider restructuring efforts to slash operating cost, the Financial Times has reported.
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Apart from escaping prevailing geopolitical uncertainty, the plan will also help the bank save money by reducing exposure to expensive real estate market of Hong Kong, four people familiar with the development told the publication.
As per the plan, which is internally referred as ‘project sun’, the lender will not completely exit the territory.
The bank will beef up its presence in Singapore by hiring new people and laying off staff in Hong Kong, the report added.
Responding to the report, the bank said: “Wells Fargo has a long-term presence in Hong Kong, Singapore and the Apac region, including Japan and mainland China, and we will continue to maintain this presence. Suggestions we are moving our focus away from Hong Kong do not accurately reflect our commitment to this market.”
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By GlobalDataWells Fargo’s executives who were responsible for covering the Asia-Pacific market had been based in Hong Kong.
However, according to the Financial Times report, the bank has advertised many of these jobs as either being based in Singapore or offering a choice between the two locations.
The report follows Wells Fargo reporting a net income of $4.7bn the bank for the three months to end March, versus $653m a year ago.
Its net interest income dipped sharply by $2.5bn, or 22%, y-o-y reflecting the impact of lower interest rates.
Specifically, the bank’s net interest margin dipped by 53 basis points y-o-y from 2.58% to 2.05%.
