HONG KONG • HSBC Holdings pointed to routine regulatory requirements ensuring client money is used for stated purposes after a report yesterday that the firm is shutting a corporate account that helped fund protest-related activities in Hong Kong - a politically sensitive issue.

The bank took action after finding the account was being used inconsistently with its original paperwork, the Hong Kong Economic Journal said. The firm informed the client last month that it will close the account after a 30-day notice period that ends this week, said the report, which did not identify who opened it.

"As part of our responsibility to know our customers and safeguard the financial industry, we regularly review our customers' accounts," Ms Vinh Tran, a spokesman for the bank in Hong Kong said in an e-mail statement. "If we spot activity differing from the stated purpose of the account, or missing information, we will proactively review all activity, which can also result in account closure."

Hong Kong's polarising protests have created headaches for companies that have come under heavy political pressure to cut any perceived ties with the city's pro-democracy movement - only to later face public backlash. In pointing to banking regulations, HSBC may show it had no discretion in the account's closing and that it is not because of politics.

Another organisation, 612 Humanitarian Relief Fund, which helps protesters pay medical expenses and legal fees, said yesterday on Facebook that its HSBC account was running normally.

Banks are required to "effectively assess risk" regarding account activity, ensuring the consistency of their stated purpose and source of funding, the Hong Kong Monetary Authority said in a separate statement yesterday.

BLOOMBERG