VANCOUVER — After 22 years of banking with HSBC for his business, Vancouver floral shop owner Gabriel Yiu was shocked to learn last week that the bank was cutting off his account.
He is one of several small- business clients whose account with HSBC has been cancelled after the bank sent out letters saying it is reviewing its clientele.
Yiu, who owns three flower shops with his wife, believes HSBC — which is headquartered in Vancouver and bills itself as the “world’s local bank” — is closing the accounts of its least profitable clients. He said it’s outrageous and discriminates against small-business owners.
It’s unclear how many businesses have had their accounts cancelled. Calls to HSBC seeking comment were not returned.
Island Savings Credit Union, which has about 6,000 business clients among its 100,000 members, expects it may reap the benefit of HSBC’s decision to drop small-business accounts. The Island-based credit union has been making the small-business market a priority.
Mark deMedeiros, senior manager of business banking for Island Savings, said they have already expanded market share by taking customers from banks such as HSBC and other institutions.
“While they are looking at shortening their list and their service offerings, we have been looking over last year at how to ramp that up and make it better,” he said. “We understand [HSBC] may want to concentrate more globally, but we are hiring four new support workers for business members, and . . . we are offering six months free if they shift their banking.”
Island Savings is also offering the first round of cheques for free and to set up an operating line of credit for new business customers.
“We know it’s difficult to switch, though HSBC has certainly made it easy as they have propelled them to switch, but it’s sometimes perceived as a daunting task,” he said. “This is a chance to show there is a different alternative out there.”
In Vancouver, Yiu and his wife received two letters from HSBC saying they have 60 days to close their accounts because the bank has recently conducted a “strategic review” of its business banking services to focus resources “on customers that will benefit most from our expertise.”
“It’s a lot of trouble for us,” Yiu said, adding they have always been in good standing with the bank. They have opened a new business account at the Royal Bank.
— with a file from the Times Colonist
