Hong Kong’s Private Wealth Bankers Should Be Anxious

Shortly after Hong Kong narrowly overtook Switzerland as the world’s largest offshore wealth management hub, the sustainability of this business is already being called into question.

The seismic event is China’s recent crackdown on cross-border stock trading. Steep penalties aside, Beijing has asked three online brokers, the biggest of which is based in Hong Kong, to liquidate all existing accounts held by mainland Chinese within two years. In a concurrent move, the city’s securities watchdog put out a statement warning against poor due diligence with client onboarding and demanding close monitoring of dormant accounts.