Compensation conversations often start and end with a number. This likely covers the salary, the bonuses, and perhaps even a housing allowance.
Rarely do they include the less obvious (but sometimes significant) extras that make an overseas posting actually workable. The things that never appear at the top of an offer letter, yet end up mattering enormously once someone has relocated.
Which is why a recent story about HSBC caught our attention.
The bank is reportedly reviewing a long-standing benefit that subsidises international school fees for a significant number of its Hong Kong-based bankers. Officially, this is being positioned as part of a wider global push to standardise pay and benefits to cut costs. As yet, no final decision has been made, but HSBC says it remains committed to rewarding staff fairly and competitively.
But the review itself is instructive, regardless of how it ends.
What The Perk Actually Covers
Hong Kong is reportedly the only major hub where HSBC staff at mid-level and above are entitled to an education allowance covering up to 95% of school fees. This is capped at roughly HK$220,000 per child per year for primary education and HK$300,000 per child per year for secondary education.
International school fees in Hong Kong are among the highest in the world, with annual tuition beyond HK$260,000 not unusual, making education one of the largest expenses many expat families face.
Hundreds of HSBC employees are said to benefit, at a cost reportedly running into tens of millions of dollars a year.
Why This Kind Of Perk Matters More Than It Sounds
It’s tempting to file a benefit like this under “nice to have”, but for many, the reality is very different. An education subsidy of this size isn’t sitting on top of their pay, but part of what makes the whole package work at all. Leaning on free state education in some jurisdictions just isn’t an option.
Remove something covering the majority of school fees, and a package that once looked generous can quickly look very different. Not because the salary changed, but because a major cost previously absorbed elsewhere lands back on the household budget.
In the expat workplace, compensation is often more layered than it appears at first.
- Base salary
- Bonus
- Housing
- Education
- Healthcare
- Relocation support
Any one of these can move independently of the others, and a change to a single line can considerably shift the overall value of the package.
Why Now, Not Just How Much
Industry recruiters see this move by HSBC as being about more than the bottom line.
Some suggest the review reflects HSBC’s changing view of Hong Kong. Perks like this existed because postings abroad were once treated as a “hardship” needing extra incentive, but recruiters suggest Hong Kong has long since stopped fitting that description.
Commentators have also described the perk as a leftover from an older, more traditional era of banking, part of a broader push by leadership to modernise the organisation. HSBC also closed its long-running international manager scheme last year, which had offered relocating staff a tax-free salary and a generous pension. Traditional “expat packages” appear to be fading more generally, not just at HSBC.
Compensation, Retention, And Where People Choose To Live
Benefits like this rarely exist by accident; they typically reflect the cost of retaining talent in one location versus another.
Hong Kong is an expensive place to raise a family, and education is one of the clearest examples of that. A subsidy of this scale has, by most accounts, functioned as a genuine retention tool, not simply a generous extra bolted onto a standard pay package.
Adjust or remove it, and employees’ calculations about where to live and work can shift as well. That’s not really a story about one bank’s cost-cutting programme, but perhaps a reflection of something broader?
Where people choose to base themselves, and how attractive an overseas role remains over time, often comes down to lifestyle costs as much as headline pay.
What This Means For Expats More Generally
Most people don’t have an HSBC-style subsidy written into their contract. But the underlying lesson applies well beyond banking.
When assessing an overseas role, the temptation is to focus on the number at the top of the offer. Salary, bonus, and perhaps, if you’re lucky, a housing allowance.
The real picture is usually more complicated, and considerably more personal:
What does suitable schooling actually cost here, and how much of it is covered?
How much of my lifestyle depends on benefits that could change?
If a perk like this disappeared tomorrow, would the numbers still work for my family?
These decide whether an attractive-looking package is genuinely sustainable, or simply attractive on paper.
The Real Value Of An Overseas Role
None of this is a comment on whether HSBC’s review is fair – that’s a decision for the bank and its employees.
However, it’s a useful reminder that compensation is rarely just the number on an offer letter. For anyone building a life abroad, particularly one that depends on employer-provided perks, understanding the true value of a compensation package – including what could change (like having children) – matters just as much as the headline figure.
When it comes to expat compensation, the real question was never simply “What am I being paid?”
It’s “What is this actually worth to me, once everything is accounted for?”
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