HSBC’s boss fended off criticism about receiving his bonuses through a Swiss bank account held by a Panamanian-registered company, as the banking giant reported a 15-percent drop in annual net profits.
Chief executive Stuart Gulliver was forced to react to a report about his finances in The Guardian newspaper, which has led coverage in Britain of an international tax-dodging scandal at the bank’s Swiss division.
“I pay full UK tax on my entire worldwide earnings,” Gulliver told reporters in a conference call, adding that the report about his account had not “in any way” impacted his leadership of the London-based bank.
He also admitted, however, that some of the practices of HSBC’s Swiss private banking arm in the past had been “a source of shame and reputational damage” and said he considered them “very unacceptable”.
The report on Gulliver came after claims that HSBC helped clients from around the world dodge taxes on accounts containing EUR180 billion (HKD1.58 trillion), which are being investigated in several countries and have caused a political storm in Britain.
The scandal has tarnished the reputation of HSBC, which was quick to react to the latest allegations.
The bank explained in a statement emailed to AFP that Gulliver had opened his account in 1998 when he was working in Hong Kong and had put it in the name of a Panamanian company “for reasons of confidentiality”.
It said Gulliver, who moved to Britain from Hong Kong in 2003, had “voluntarily declared his Swiss account to UK tax authorities for a number of years”.
The bank also noted that Gulliver’s overall compensation slid by five percent last year to GBP7.6 million (HKD91 million) after performance-related pay was cut by over a third.
The bank apologised again on Monday over the so-called “SwissLeaks” allegations, saying they served as a reminder “of how much there still is to do and how far society’s expectations have changed in terms of banks’ responsibilities.”
HSBC also revealed on Monday that 2014 earnings plunged in a “challenging year” that was blighted by fines and compensation for mis-selling.
Earnings after taxation or net profits sank 15 percent to $13.7 billion (12.0 billion euros) last year, HSBC said in a separate results statement.
Words: AFP
Photo: WiNG via Wikimedia
