Singapore banks see influx of Hong Kong capital

TAIPEI, Jun 7, 2020, Taiwan News. Singapore is seeing money pouring into its banks as the coronavirus pandemic, escalating U.S.-China trade war, and incessant social unrest in Hong Kong make the Southeast Asian country attractive for international capital, Taiwan News reported.

According to data from the city-state’s central bank, deposits from nonresidents surged 44 percent to a record S$62.14 billion ($44.54 billion) in April from a year earlier. It also showed foreign-currency deposits almost quadrupled to a record S$27 billion, up nearly 200 percent in the first four months of 2020 compared with the same period last year, Reuters reported.

Although the data did not clarify the source of the funds, analysts pointed at Hong Kong because of the conflicts that have been roiling the territory since last year. The Monetary Authority of Singapore told Reuters it’s seen significant money flows into the country from nonresidents and multiple sources, including Hong Kong.

Since Beijing signaled it would impose a new national security law in Hong Kong, international businesses have come under pressure to support the authorities. After receiving public admonitions from the former Chief Executive of Hong Kong, Leung Chun-ying, and China’s state-run mouthpiece, Beijing Daily, banks like HSBC and Standard Chartered announced they would back the national security law.

According to a statement from HSBC, the British bank respects and supports any law that will stabilize Hong Kong society and revive its economy. Its chief executive in the Asia-Pacific region, Wong Tung-shun, has signed an endorsement of the national security law.

Support from the two British banks is in contrast to the backing the British government intends to offer oppressed Hongkongers. Several British MPs want to summon the banks’ management to explain to the whole country their decisions.

U.S. senators have drafted a sanction bill that will target entities or banks that violate Hong Kong’s Basic Law and deprive the territory of its autonomy.