Georges Elhedery, chief financial officer of HSBC Holdings (00005), said in an interview with Reuters that the group is considering exiting as many as 12 national markets, accounting for one-fifth of the group’s global presence, and strengthening its focus on business expansion in Asia.
The report pointed out that the consideration was under pressure from major shareholder Ping An Insurance (02318) of China, which wanted HSBC to prioritize growth in Asia because 78% of the bank’s total profits come from Asia. Elhedery pointed out that the growth of some markets that are evaluating the feasibility of exiting is relatively backward, which is not enough to affect the overall business portfolio, but the group expects that the exit of business in these regions will contribute to the deployment in Asia. But he declined to say which markets were being reviewed, nor did he give a timetable.
HSBC is determined to “return to Asia”. In the past two years, it has successively announced plans to sell all or part of its business in France, Greece, Russia and Canada. It is considering withdrawing from more markets and concentrating resources in Asia. HSBC doesn’t break out all of its performance across countries, making it difficult to pinpoint which markets are underperforming. However, the group’s European and Latin American businesses may be closely watched. The former recorded a net loss last year, while the Latin American market only accounted for less than 5% of the group’s total profit.
Elhedery said that the Mexican market is not currently under evaluation for exit. He said that the performance of Mexico is very good for the group. The growth of local business has benefited from the USMCA trade agreement and the “China plus one” strategy of multinational companies. . He mentioned that about 70% of the customers of the retail business of the group’s local banks are employees of multinational companies, reflecting the strong synergy with the group’s wholesale business.
Elhedery also pointed out that whether it is the acquisition of Silicon Valley Bank in the UK, or through the acquisition of businesses in India and the Middle East, it will bring growth opportunities for HSBC. The group expects that the fee income earned through the wealth business will become more and more important to the overall profit. The bank is planning to increase revenue through related wealth services, especially in China and Hong Kong, where the new crown epidemic prevention measures have been lifted and customs clearance has been fully implemented, and the economies of the two places have begun to return to normal. HSBC is on track to hire about 2,000 more private wealth managers for the mainland insurance sector in the next two years, a figure that does not include the 1,000 it hired last year, he said.
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2023-05-26 08:25:51
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