Banking News: HSBC Banks on GMT +8

Does HSBC's decision to move CEO Michael Geoghegan from London to Hong Kong signal the beginning of a downturn for the UK's dominance in the global financial market?

There are signs that it's not London per se but the GMT time zone that is out of sync.

Switzerland, of course, is on EU time, one hour ahead of GMT. But it has seen its private wealth management drift rapidly east to Singapore at GMT +8.

The middle east, at around GMT +4 tends to run, more or less, to GMT, insofar as its international business is concerned. But it now appears that the business that moved there may have been in transit on its way to Singapore.

More importantly, the middle east has not grabbed the bulk of the Islamic finance market. And whilst London has been quick to develop skills, the global heart of these markets is Malaysia - at GMT +8.

Corporate business depends on large and efficient stock markets. In the GMT +8 region, that means Hong Kong which sees more and bigger IPOs than any other exchange in the region. Corporate bankers don't want to be anywhere else.

In retail banking, European markets are close to saturation, at least for customers that have any money. But the GMT +8 region includes Malaysia, Singapore, Hong Kong - and China. And with plus or minus an hour, Indonesia, Thailand, Cambodia, Taiwan, Korea (both of them). And for +2 hours Australia, New Zealand and the Pacific Islands.

That's where HSBC, Standard Chartered and ANZ all see growth. Unlike RBS and Bank of Scotland, which targeted selected niches in what it hoped were lucrative pockets and fell flat their faces, these three are offering full service banking in the markets they enter and becoming part of the local infrastructure.

And that's why the HSBC move is so important.

Michael Geoghegan is going where the money is. It's where HSBC wanted to be all along but the prejudice of UK regulators against Chinese financial services regulation made HSBC relocate to the UK as a condition of its take-over of Midland Bank.

But for HSBC it's not just step towards home: it's a signal that it's time to consider where the next hundred years of growth will be for banks. And that, it is sure, is not going to be in the GMT time zone.

For sure, there will be growth to be had in India and Africa but for the foreseeable future, both are shambollic and regulation is a mess in most of Africa and the Indian sub-continent.

HSBC's decision is probably the first in a long line of companies that consider where best to be.

And Hong Kong's regulatory regime is probably the most welcoming in the GMT+8 timezone for those that have little or no existing footprint in the region.