The Hong Kong Monetary Authority has raised concerns with HSBC about its plans to set up an AI center in Singapore rather than the territory, the Financial Times reported. Insiders confirmed to the publication that the HKMA reached out to the bank recently about the location decision.
HSBC revealed the initiative in July, describing the “global AI centre of excellence” as a facility that will employ “more than 100 AI specialists” to enhance technology within its wealth management and payments operations.
This development occurs as part of a broader reorganization spearheaded by CEO Georges Elhedery, who has been streamlining the bank’s global footprint by exiting certain overseas operations to focus on core markets—with Hong Kong ranking as a top priority.
A source close to the situation emphasized Hong Kong’s heightened sensitivity to talent relocation, particularly when it appears the bank is shifting key functions. The individual also noted that local authorities fear losing their position as the region’s primary financial hub.
The Singapore-based AI venture follows Elhedery’s first major deal since assuming leadership: a $14 billion acquisition to gain full ownership of Hong Kong’s Hang Seng. Earlier this year, HSBC also finalized the sale of its Singapore insurance arm to Allianz for $2.1 billion.
Industry contacts suggest the AI center announcement was partly designed to demonstrate HSBC’s ongoing dedication to Singapore. The bank already operates specialized AI teams in both the UK and Hong Kong, and is developing an AI research facility within mainland China.
Separately, the HKMA has engaged in discussions with HSBC and Standard Chartered about assigning senior executives to Hong Kong, according to two individuals briefed on the conversations. HSBC declined to address its talks with regulators regarding the Singapore-based AI operation.
In a statement about leadership distribution, HSBC affirmed: “We have senior leaders based in both our home markets of London and Hong Kong.” Meanwhile, Standard Chartered has recently transferred executives from Singapore to Hong Kong.
A person familiar with the HKMA’s regulatory engagements explained that such requests for on-the-ground executive presence have been a longstanding practice, ensuring top decision-makers at international banks remain directly accountable. Maintaining Hong Kong’s reputation as a leading global financial center remains a cornerstone of the HKMA’s four key statutory duties.