Canadian banks blocking Hong Kongers’ access to an estimated C$1.5 billion in pension savings

Manulife and Sun Life are blocking thousands of Hong Kongers from accessing an estimated C$1.5 billion worth of pension savings after they have fled Hong Kong to the UK on the BNO visa.

The funds are held as part of Hong Kong’s mandatory pension scheme, which are held in trust by various financial institutions, including the Canadian banks, as part of the Mandatory Provident Fund (MPF) system.

Ordinarily, anyone leaving Hong Kong permanently is entitled to withdraw their savings held in the MPF.

But a unilateral declaration from the Chinese Ministry of Foreign Affairs in response to the opening of the BNO visa scheme in January 2021 to no longer recognise the British National (Overseas) identity has blocked access for hundreds of thousands of Hong Kongers.

This retaliatory action has been conducted by fiat with no laws or regulations being changed in Hong Kong regarding the operation of the Mandatory Provident Fund.

Hong Kong Watch has seen several letters from banks to individuals, rejecting their early MPF withdrawal claims based on this guidance from the Hong Kong government to the Mandatory Provident Fund Authority which supervises the provision of MPF schemes.

In total, Hong Kongers in the UK are being denied access to around C$3.7 billion in pension savings. As of December 2022, the total value of all MPF schemes was a little over HK$1.05 trillion (C$182.3 billion). Canadian banks between them occupy 40 per cent of the MPF market.

Manulife alone holds almost 28 per cent of the MPF market with over C$50 billion assets under management. Sun Life has around C$21 billion. Management fees for the Manulife MPF funds vary between 0.75 per cent and 1.90 per cent. Sun Life’s vary from 0.733 per cent to 2.013 per cent.

The full briefing can be read here.

Sam Goodman, Director of Policy and Advocacy at Hong Kong Watch, said:

“Our research shows that Manulife and Sun Life are working hand in glove with the Hong Kong Government to block Hong Kongers leaving the city from withdrawing their pension savings.

The decision by Manulife and Sun Life is in direct contradiction to their responsibilities as trustees of the Mandatory Provident Fund to give access to pension savings where evidence is presented that individuals have the right to reside outside of Hong Kong, as they do with the British National Overseas (BNO) Visa scheme.

We urge the Canadian Government to work with Manulife and Sun Life to explore ways that they can ensure that Hong Kongers are given access to their pension savings.”