BANKING: Same Place, New Address

It is more than just a bank. For 125 years, the Hongkong & Shanghai Banking Corp. has been virtually synonymous with the crown colony. Its 42-story headquarters looms over the central financial district, housing what is often referred to as Hong Kong's "real" government. The bank prints 83% of the colony's currency and performs many of the functions of central banks elsewhere. Thus last week's announcement came as a terrible shock: the banking company was moving its legal domicile to London.

Chairman William Purves explained that the bank was hoping to reassure shareholders and financial markets, which are increasingly apprehensive over the colony's reversion to Chinese sovereignty in 1997. Said he: "I do have confidence in the future of Hong Kong, but sadly I cannot convince others." Hong Kong's left-wing newspapers, which often reflect Beijing's views, accused the bank of abandoning the colony and damaging public confidence. Editorialized one of them: "The Hongkong bank wants to retain its privileges. It just doesn't want to accept any responsibility."