The Bank of Bermuda's pending sale to multinational banking giant HSBC Plc was yesterday given an overwhelming vote of confidence by the Island's business community.

But business leaders also recognised that the financial merits of the deal did not dispel the emotional issue of seeing the Island's largest bank sold to a foreign institution.

Half a dozen heads from the Island's various business organisations told The Royal Gazette they gave high regard to the bank's proposed sale - including HSBC's stated commitment to continue support of the community through the Bank of Bermuda Foundation - following a number of different meetings they attended this week with HSBC chairman Sir John Bond.

Sir John said his visit to the Island was intended to "put a human face" on HSBC. While here he met with a cross-section of stakeholders from Government to business leaders and bank executives and clients.

David Ezekiel, the chairman of the Association of Bermuda International Companies, said he had been impressed by Sir John's demonstrable awareness of the issues in this transaction. And he cited his visit as a coup for the bank.

"It was a good move to expose him to the community. He made a very favourable impression."

But Mr. Ezekiel said the issues continued to fall "very squarely" into two distinct areas; the first being the financial impact of the transaction and the second being the more nostalgic issue of a long-standing Bermuda institution being taken over by a foreign corporation.

Mr. Ezekiel said on the financial side, people would have to make their own decisions on the value put on the bank.

On the second issue, he said: "In a perfect world, the bank would have continued as is.

"But if we listen to management, this is what is required to ensure the bank's long-term viability.

"It is a very difficult one, but HSBC is doing a good job to be sensitive to the issues and assuring that the Bank of Bermuda brand is not just going to disappear."

Mr. Ezekiel said from the "very narrow perspective" of the ABIC membership the deal was a positive development.

"I have always said there is nothing more nervous than money. Money wants stability. The bar is being raised everyday on what is wanted when one puts money somewhere.

"For the bank itself, and for Bermuda from a regulatory and financial wherewithal, it is all positive."

ABIC vice-chairman Harry Wilken said HSBC was well known to him and that he had confidence in their takeover of the Bank of Bermuda.

"I have known HSBC over many moons - I have personally banked with them for 31 years - and I have seen them acquire all over the world. And it is fair to say that they have always moved in with good sense and without heavy boots."

The breakfast meeting with Sir John was also a chance for Mr. Wilken to meet up with "a friend of many years," as he knew Sir John from years ago when both lived in Hong Kong.

Mr. Wilken who is the chairman of the listing committee of the Bermuda Stock Exchange also cited HSBC's intent to do a secondary listing on the BSX as very encouraging.

Chairman of the Bermuda Chamber of Commerce Charles Gosling said: "If anything this was just a further reaffirmation," he said, citing the deal as something he already had viewed as a positive development after canvassing his members for their opinion, and finding most in favour.

"The chamber had done an enquiry amongst its members - as there had been plans for a TV talk show - and the only negative thing that ever came up were certain emotive issues with the bank being sold to a foreign institution.

"But overall it is one helluva pat on the bank for the Bermuda Monetary Authority and the Finance Ministry," he said, referring to HSBC's choice of making an acquisition in this jurisdiction.

He said it was also an affirmation for the bank, and that given the size of HSBC customers should benefit from "a lot of savings through scale".

"Sir John primarily wants business to remain as is.

He wants the change over to be as smooth as possible, and for things to continue to appear as they do today."

He said that Sir John did say the HSBC colour's and logo would be incorporated, as a means of making them recognisable to their existing customers coming to Bermuda, but that the name was to stay the same "for the time being".

Mr. Gosling said the issue of dividend payments was also raised, and that HSBC was paying a "slightly higher rate" than the bank does.

Although looking at the transaction as a positive, Mr. Gosling said he thought there could still be more effort put into breaking down the benefits of the merger for all.

"They need to get the message a little closer to the street.

"A lot of shareholders may not understand what all of the benefits are."

Shareholders vote on the bank's proposed sale to HSBC next month.

But were the sale not to go through Mr. Gosling said there could be negative fallout for the Island.

"It would be bad for the bank, bad for the Island as it would send a terrible message in terms of our business acumen.

"We would not be held with any great seriousness," he said.

Bermuda Employer's Council president Eddie Saints said he already held a positive view of the bank's merger with HSBC, but meeting with Sir John had bolstered that.

"Sir John talked about many aspects of the HSBC culture, and I came away feeling very positive and confident. I already felt positive but this reinforced that."

Mr. Saints said a number of issues had been covered at the breakfast meeting, with Sir John spending more than an hour with the business leaders.

For Mr. Saints, at the meeting in his BEC capacity, he said his focus had been on the labour relations side.

The Bank of Bermuda previously announced that there could be up to 250 job cuts over the next three years, but Mr. Saints said he recognised that businesses across the globe were having to make cuts, and streamline their operations.

"There was not much talk about the job cuts. It is a business issue no matter where you are; all businesses have to to face that," he said. And speaking as the general manager of Cable & Wireless Bermuda Ltd., (which is itself owned by UK-based Cable & Wireless), he said: "Even in my company, we have gone through a redundancy cycle over the last three to four years.

"HSBC has a culture comparable to the bank's current culture, and employees are an important element of that. HSBC has a history of giving its staff the materials and support they need to make the right decisions. There is a sensitivity to employees and a lot of effort made."

He said that there was also an impressive effort being made by the bank to get information on the proposed sale to HSBC out to staff and shareholders.

"There is a big emphasis on information and its dissemination so that all can make an informed decision. The approach to this has been in a clear, decisive manner. The matter is being treated very seriously; it is not being taken lightly."

He said there were some very frank questions asked at the meeting with Sir John including whether the bank's support of the Bank of Bermuda Foundation's community initiatives would continue, with Mr. Saints saying that Sir John's response was "that is an easy decision; absolutely".

He described Sir John as "personable, knowledgeable and taking the whole exercise with a great deal of personal interest". "Sir John expressed a wealth of commitment to the community.

"HSBC itself is very community oriented and this is a complement to the Bank of Bermuda Foundation.

"I am very confident that here is a company that will envelope a Bermuda institution and even raise its standards in many respects. I came away with the feeling that they would be giving much more value to Bermuda, and that we can benefit and learn from HSBC.

"This is not a foreign corporation coming in to pillage. They too will benefit, but Bermuda can be comforted. We should take great comfort in this development."

Head of the Bermuda International Business Association Gregory Haycock said: "I am very pleased that Henry Smith invited business leaders to ask questions of the chairman."

Mr. Haycock said from a BIBA perspective, he was most interested in the sale from the perspective of fund and trust industry business.

"I would say this is full of possibility. And the HSBC purchase of the Bank of Bermuda raises the profile of Bermuda as a quality jurisdiction."

He said that the sale could also help the Island's image overseas.

"HSBC will assist Bermuda in its marketing as an offshore jurisdiction. In the UK we often come up against other jurisdictions. I think HSBC will help us in our marketing efforts.

This raises the profile of the Island as a quality offshore jurisdiction generally. It brings a lot of credibility to Bermuda.

"Fiscally, John advised that Bermuda and the Bank of Bermuda would headquarter its trust business here," Mr. Haycock said, adding that HSBC also planned to build on the existing "parameters" of the bank's fund administration business.

"He was also sensitive to the needs of the community and the need to protect the relationship with the community. And he spoke positively of training opportunities for Bermudians with HSBC throughout the world."

He said that when asked what would be the first order of business, if the sale was voted through by shareholders, Sir John said: "To win over the hearts and minds of Bermuda; that this is good for Bermuda".

Mr. Haycock said he welcomed the opportunity to work with such a well-established bank.

Ernst & Young managing partner Anthony Joaquin, who met Sir John at a bank function on Monday, said he believed from a business perspective, and more specifically from the perspective of the international business base, this was very positive for Bermuda.

"There will be access to a bigger suite of products, more capital. Those are two of many factors. This can only be positive for international business clientele. International business is a major part of the economy, and what is positive for the economy is positive for Bermuda."