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Tag: HSBC

  • HSBC’s First-Half Profit Dive Misses Analyst Forecasts

    HSBC’s First-Half Profit Dive Misses Analyst Forecasts

    HSBC’s pre-tax profits plummeted in the first half by 65 percent year-on-year as the Asia-focused lender further boosted loan loss provisions to ready for more headwinds. HSBC registered $4.32 billion in pre-tax profits compared to $12.41 billion in the same period last year and analyst forecasts of $5.67 billion, according to compilations made by the bank.

    Given the current high degree of uncertainty, we are continuing to monitor closely the implications on our business plan and medium-term financial targets, while also undertaking a review of our future dividend policy, HSBC’s chief executive Noel Quinn said in a statement.

    The bank also expected total credit impairment provisions for the year to reach between $8 billion and $13 billion, higher than previous forecasts. Provisions reached $6.9 billion in the first half after the bank said aside $3 billion in the first quarter, compared to just $1 billion in the first half of 2019.

    The bank also warned of expected damage to its core capital ratio as worsening credit ratings impact its risk-weighted asset ratio.

    Financial and economic headwinds aside, HSBC also highlighted the risk of rising U.S.-China tensions heightened by the national security law and the Hong Kong Autonomy Act.

    Like our clients, HSBC has to operate in a difficult geopolitical environment. Current tensions between China and the US inevitably create challenging situations for an organization with HSBC’s footprint, Quin added.

    However, the need for a bank capable of bridging the economies of east and west is acute, and we are well placed to fulfill this role. We will face any political challenges that arise with a focus on the long-term needs of our customers and the best interests of our investors.

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  • HSBC Promotes Investment Duo at Private Bank

    HSBC Promotes Investment Duo at Private Bank

    HSBC Private Banking promotes two executives in its investment and product solutions unit in Asia, effective immediately.

    The bank appoints Jeffrey Yap as head of investment services and product solutions (ISPS) for Southeast Asia after his last role as regional head of fixed income, currencies and commodities (FICC) Asia Pacific, according to a statement. Adam Lau has also been appointed to the newly created role of regional head of market solutions, Asia Pacific.

    Yap joined HSBC in 2017 from Alliance Group (PAG), where he was managing director responsible for the firm’s public fixed-income investments. Lau is a 20-year financial veteran who joined HSBC in 2018 from Natixis where he was its Greater China head of equity solution sales. He was also previously with Deutsche Bank as its Greater China head of private banking and retail sales and J.P. Morgan as a structured product marketer.

    Yap reports to Philip Kunz, head of Southeast Asia at HSBC Private Banking and Abdel Ben Tkhayet, APAC head of ISPS while Lau will continue to report to the latter.

    In addition to developing talent internally, the bank also highlighted Singapore as a key market for its wealth business and underlined specific client segments that bank in the booking center.

    As a leading international wealth center, Singapore is one of our key wealth markets, where we serve a significant group of international clients from Southeast Asia, Greater China and other parts of the world, Kunz.

    Under the leadership of [Yap] and [Lau], I’m confident that HSBC Private Banking will build on our strong momentum and expand and enhance our range of products and services to distinctly meet our clients’ wealth needs.

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  • HSBC Job Cuts Reach Asia

    HSBC Job Cuts Reach Asia

    HSBC’s cost-saving drive is reportedly set to accelerate even in its most profitable markets in Asia following the departure of its global head of equities. Hossein Zaimi is leaving HSBC, according to a report citing two unnamed sources, after joining the bank more than 16 years ago. Zaimi also took on the additional role of co-head of securities financing in March shortly after HSBC revealed plans for its investment bank overhaul.

    Adrian Lewis, EMEA head of equity capital markets (ECM), has also left to pursue opportunities outside of the industry, the report added. Lewis will be succeeded by Andrew Robinson, head of EMEA equity syndicate, reporting to Ed Sankey who was named global head of ECM in June 2019.

    While the lion’s share of cost cuts reside in Europe, the report noted that Asia – the most profitable region for HSBC – will not be immune to restructuring. Following Zaimi’s departure, more exits are expected in the region in the coming weeks.

    The bank originally planned to cut 35,000 jobs, $4.5 billion in costs, and $100 billion in risk-weighted assets before postponing the overhaul in March due to the coronavirus pandemic. In June, HSBC reportedly resumed such activities in June and was considering deeper cuts including more job losses or the possible sale of some businesses.

    Simultaneously, the bank is also expanding its newly created wealth and personal banking unit – a combination of the whole private client business from retail to ultra-high net worth (UHNW) individuals – with around half of its $4 trillion in assets from Asia.

    Since 2017, the bank has hired 800 employees for its affluent and emerging high net worth client businesses – Premier and Jade, respectively – across Hong Kong, Singapore, and mainland China including relationship managers, investment counselors, UHNW solution specialists, and product specialists.

  • HSBC Nets Southeast Asia Equities Duo from Deutsche Bank

    HSBC Nets Southeast Asia Equities Duo from Deutsche Bank

    HSBC bolsters its Southeast Asian equities unit in Singapore with two new hires from Deutsche Bank, furthering its Asia expansion amid a major overhaul. HSBC hires Edward Lee as regional head of equity capital markets and Joy Wang as the head of Southeast Asia equities research, according to a report.

    Lee had over 20 years of industry experience and was most recently with Deutsche Bank as its co-head of investment banking coverage and head of equity capital markets, Southeast Asia.

    Wang was also most recently with Deutsche Bank where she was last its co-head of APAC property equity research in addition to other roles.

    Lee and Wang become the third joiners in less than a year from Deutsche Bank to HSBC in Singapore. In September last year, HSBC named ex-Deutsche Bank regional vice chairman Philip Lee as its new Southeast Asia vice-chairman.

    Restructuring at both HSBC and Deutsche Bank has led to a flurry of talent movement between the two lenders across business divisions. Just last month, Deutsche Bank hired former HSBC private banker Chow Shang-Wei to become the Southeast Asia head of its wealth arm.

    And outside of Asia, HSBC reportedly hired Deutsche Bank’s former co-head of corporate finance for Europe, the Middle East, and Africa Adam Bagshaw as its global co-head of advisory and investment banking coverage.

  • HSBC Singapore Spared as Overhaul Resumes

    HSBC Singapore Spared as Overhaul Resumes

    The bank’s said that the city-state remains a growth market and will continue to hire talent in its bid to become the leading international bank.

    Singapore will not be affected this year by the bank’s restructuring exercise that is expected to see it shed some 35,000 employees globally, people familiar with the matter said.

    The bank said plans to hire more than 400 retail and private banking customer-facing employees by 2023 also remains on track.

    Since 2018, HSBC Singapore has grown its headcount by 10 percent and has invested in our premises, digital capability and propositions in order to grow our customer base and market share,» a spokesperson said, the newspaper reported. «These investments and growth ambitions will continue.

    Yesterday, HSBC lifted its moratorium on job cuts to about 15 percent of its workforce, announced in March at the height of the Covid-19 pandemic.

    HSBC chief executive Noel Quinn, who unveiled the overhaul in February, told the bank’s 235,000 global staff in a memo that the exercise is even more necessary today.

    The British lender is currently at the center of a controversy over its support for Beijing’s new security law for Hong Kong, the bank’s most important market.

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  • HSBC APAC Chief Risk Officer Steps Down

    HSBC APAC Chief Risk Officer Steps Down

    Family reasons were cited as the recent for the exit with an interim head being flown in from the U.K. Ed Jenkins steps down after joining HSBC more than a decade ago and less than a year after being named chief risk officer for the region. He will take a sabbatical after July 1 before returning to the bank in October, according to a report citing an internal memo.

    Marc McKewon, Jenkins’ predecessor, will return from the U.K. to become the Hong Kong-based interim chief risk officer. McKewon is currently the global chief corporate credit officer, head of the wholesale market and credit risk.

    HSBC has been a major receipt of increasing risks across social, economic and political fronts. In addition to the broad-based effects of the coronavirus pandemic, the bank has been spotlighted in reported tensions with pro-democracy protesters; dividend-hungry shareholders; Beijing-backed officials; British Tory members; and internal staff.

    HSBC is also concurrently attempting to restart and deepen an overhaul originally targeting a giant reduction of 35,000 job, $4.5 billion in costs and $100 billion in risk-weighted assets.

  • Offshore Banking Inquiries From Hong Kongers Spike

    Offshore Banking Inquiries From Hong Kongers Spike

    HSBC and Standard Chartered were reportedly amongst the lenders experiencing a significant increase in offshore banking inquiries from Hong Kong residents.

    The two British lenders both registered a 25-30 percent jump in inquiries, according to a  report citing two unnamed sources who observed an increased demand for offshore accounts. Another two sources noted that while there have been no large outflows in the last two weeks, the increased inquiries is slowing banks’ response time for account opening which can now take at least one month.

    Popular offshore banking locations in include Singapore, U.K., Sydney and Taiwan, the report added while also citing Citi amongst lenders that observed increased demand.

    Spokespersons from all three banks claimed to have observed no significant capital outflow.

    Deteriorating U.S.-China relations and increasing tightening by Beijing are driving more and more concerns about the need to diversify holdings and booking centers. According to another source, recently observed demand represents the second wave of offshore account opening after the first one following anti-government protests in June last year.

    What I’m worried about the most is I might not be able to freely exchange Hong Kong dollar anymore if the U.S. decided to sanction Hong Kong, the report added, citing a middle-aged resident who diversified 70 percent of her savings into U.S. dollar and British pounds while now seeking an offshore account.

    If things get messy here I might not even be able to transfer my money out in the worst-case scenario, so it’s good to diversify risks.

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  • HSBC Adds Offshore Investment Options

    HSBC Adds Offshore Investment Options

    The bank has become the first international bank in China to roll out Qualified Domestic Limited Partnership (QDLP) investments.

    HSBC is expanding overseas investment options for its Chinese high-net-worth (HNW) clients under a partnership with China International Fund Management – 51 percent-owned by J.P. Morgan Asset Management – to distribute asset management plans investing in QDLP, the bank announced on Tuesday.

    The QDLP scheme facilitates investments in offshore traditional and alternative investments by allowing qualified foreign asset managers to raise money in Chinese currency from a qualified individual and institutional investors in mainland China to invest in alternative assets abroad.

    This new scheme will help clients diversify their investments and leverage overseas opportunities to mitigate risks in their overall portfolio and further grow their wealth, especially amid uncertainty in the global markets, Richard Li, executive vice president and head of wealth and personal banking, HSBC China, said.

    Unlike the Qualified Foreign Institutional Investors (QDII) program, QDLP can direct Chinese domestic investors’ funds to overseas markets and allow investments in alternative assets, including hedge funds, private equity funds, and real estate investment trusts (REITs).

    A QDLP pilot was launched by China’s State Administration of Foreign Exchange in 2013. Since its launch, China has granted a total of $5 billion in quotas.

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  • HSBC Digital Payment User Growth Surges

    HSBC Digital Payment User Growth Surges

    HSBC’s PayMe – Hong Kong’s largest e-wallet operator – reached 2 million users, fuelled in part by the city’s love for card and tile games.

    The 2 million users represented a 25 percent year-on-year increase as transactions in the broader e-wallet payment activity, run by 10 operators, tripled due to the Hong Kong Monetary Authority’s faster payment systems (FPS).

    According to HSBC’s managing director and head of PayMe Kerry Wong Chu Po-yin, the accelerated growth was driven by the ongoing pandemic and increasing bill settlements.

    We have seen above-average growth in registration and more active usage of PayMe over these few months of Covid-19 pandemic,” Wong said in an SCMP report. The increase is seen in settling of bills, including those related to online social games such as mahjong and poker.

    The ongoing coronavirus pandemic has caused significantly accelerated digital adoption in Asia across banks and client segments. It took PayMe 17 months to acquire its first million users but around eight months to achieve the second million.

    Need for digital access aside, the coronavirus pandemic has created a bankconstant demand for healthcare goods – some merchants with 15,000 to 40,000 transactions in a single day involving surgical face masks, according to Wong.

    «Our payment platform also helps start-ups and other businesses to accept payment easily,» she said. «Looking ahead, we will line up more big companies [such as utility providers].»

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  • HSBC Ordered to Restart and Deepen Overhaul

    HSBC Ordered to Restart and Deepen Overhaul

    The economically crippling coronavirus pandemic has driven HSBC’s board to push the British lender not only to restart the original overhaul strategy but also further deepen cost cuts.

    The ongoing health crisis has prompted the board to review the HSBC’s recent reorganization, according to a «Financial Times» report citing unnamed sources from the bank, and consider more drastic measures.

    The bank has been undergoing restructuring changes while concurrently attempting to retain most jobs. After announcing its plan to cut 35,000 jobs, $4.5 billion in costs and $100 billion in risk-weighted assets, HSBC announced a pause most of the job cuts while proceeding with its original plan «wherever possible»

    Intensified restructuring could potentially include more job cuts or a possible sale of its U.S. business, its retail network in France and operations in smaller non-strategic markets, the report added.

    A spokesperson for HSBC declined to comment on the report.

    HSBC has been continuously facing a stampede of challenges after finally confirming its permanent chief executive Noel Quinn in March this year. Since then, the London-headquartered bank has faced social unrest in Hong Kong, a temporary pause to its plans to cut 35,000 jobs, a dividend cancellation fiasco and now a greater overhaul driven by the pandemic.

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  • Hong Konger Card Game Passions Drive Digital Payments at HSBC

    Hong Konger Card Game Passions Drive Digital Payments at HSBC

    HSBC’s PayMe – Hong Kong’s largest e-wallet operator – reached 2 million users, fuelled in part by the city’s love for card and tile games.

    The 2 million users represented a 25 percent year-on-year increase as transactions in the broader e-wallet payment activity, run by 10 operators, tripled due to the Hong Kong Monetary Authority’s faster payment systems (FPS).

    According to HSBC’s managing director and head of PayMe Kerry Wong Chu Po-yin, the accelerated growth was driven by the ongoing pandemic and increasing bill settlements.

    We have seen above-average growth in registration and more active usage of PayMe over these few months of Covid-19 pandemic,” Wong said in an SCMP report. The increase is seen in settling of bills, including those related to online social games such as mahjong and poker.

    The ongoing coronavirus pandemic has caused significantly accelerated digital adoption in Asia across banks and client segments. It took PayMe 17 months to acquire its first million users but around eight months to achieve the second million.

    Need for digital access aside, the coronavirus pandemic has created a constant demand for healthcare goods – some merchants with 15,000 to 40,000 transactions in a single day involving surgical face masks, according to Wong.

    Our payment platform also helps start-ups and other businesses to accept payment easily,» she said. «Looking ahead, we will line up more big companies such as utility providers.

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  • HSBC Zones in on Family Offices in Asia

    HSBC Zones in on Family Offices in Asia

    The U.K.-headquartered bank will place a much greater focus on the family office segment in Asia following the new merger of its wealth unit.

    Over the next three years, HSBC will look to grow client assets in the unit at a double-digit rate, according to a report. The recent merger of the private banking and retail wealth business formed a unit that now manages around $1.3 trillion in assets globally including nearly half from Asia.

    And of the broader market, HSBC will look to add greater focus on wealthier clients, especially those with sufficient assets to oversee via a family office.

    With the combination, there is a big, big focus on family offices going forward,» said Greg Hingston, recently appointed regional head of wealth and personal banking at HSBC. «And it all fits within that focus around increasing penetration into the high and ultra-high net worth segments.

    In addition to segment focus, the bank has also seen a boost in digital activities in the midst of a coronavirus pandemic that has reduced physical traffic and branch access.

    In Hong Kong, average monthly equity and FX transactions surged 63 percent and 65 percent, respectively. Retail activities saw similar trends with 94 percent of all regional transactions in March conducted online.

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  • HSBC Becomes Wholly-Owned Insurer in China

    HSBC Becomes Wholly-Owned Insurer in China

    HSBC agreed to buy out the other 50 percent of shares from its life insurance joint venture in mainland China in yet another milestone for foreign entry into finance on the mainland.

    HSBC will become the sole owner of HSBC Life China after acquiring the shares from its Beijing-based partner National Trust for an undisclosed sum, subject to regulatory approvals including from the China Banking and Insurance Regulatory Commission.

    The HSBC Life China JV was formed in 2009 and currently has a presence in nine mainland cities including Beijing, Guangzhou, Shanghai and Shenzhen. As of December 31 last year, the insurer had 1.03 billion yuan ($146 million) in registered capital.

    According to Swiss Re, China’s insurance market ranks third behind the U.S. and Japan at an estimated $318 billion in premiums. But despite the sizeable scale and the relatively long presence of some foreign players, insurers from abroad hold less than 10 percent market share due to ownership restrictions and limited geographical presence.

    With the recent reforms, which also included lifted ownership caps in the securities, futures and asset management industry, HSBC joins the likes of AXA and Allianz as foreign wholly-owned insurers in mainland China.

    «Despite the current difficult environment engendered by the Covid-19 pandemic, we continue to take steps to implement our growth strategy,» said HSBC chief executive Noel Quinn in a statement. «This transaction supports our ambition to accelerate growth within our Asian franchise, particularly in the dynamic and fast-growing Greater Bay Area, where we fully intend to expand in all lines of businesses.»

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  • More Loan Loss Provisions at HSBC After Q1 Profit Plunge

    More Loan Loss Provisions at HSBC After Q1 Profit Plunge

    HSBC reported a 48 percent year-on-year drop in pre-tax profits and increased its reserve for in anticipation of loan losses fuelled by the ongoing pandemic and volatile oil prices.

    The British lender registered $3.23 billion of quarterly pre-tax profits, falling short of the average analyst forecast of $3.67 billion. It also upped loan loss provisions by $2.4 billion to $3 billion attributing the headwinds to coronavirus and oil, citing «a significant charge related to a corporate exposure – a likely reference to reported recent troubles with oil trader Hin Leong.

    Revenue was down 5.1 percent to $13.69 billion and operating expenses also fell 4.5 percent to $7.85 billion.

    According to an HSBC statement, the outlook for world economies in 2020 has substantially worsened in the past two months» and warned of the potential for more bad loans and weaker margins from lower rates. Expect materially lower profitability in 2020, the statement added.

    On dividends – a thorny issue from the bank which has faced outrage from disappointed Hong Kong retail shareholders – the bank will review at or ahead of HSBC’s year-end results for 2020.

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  • HSBC Private Bank Managing Director to Depart

    HSBC Private Bank Managing Director to Depart

    He announced his departure on LinkedIn on Friday, saying he was «excited» to head to his next destination.

    Shang-Wei Chao, HSBC Private Banking’s Singapore and Malaysia market head, will be leaving the firm, he announced in a LinkedIn post, which was confirmed by a spokesperson at the bank.

    Chao joined HSBC in 2016, after 12 years at UBS, where he was a client advisor and desk head covering numerous Southeast Asian markets. The bank did not disclose plans for a replacement.

    Since joining HSBC Private Banking in 2016, I’ve felt that I was on an express train that didn’t need to stop to refuel, Chao said in the post.

    The bank has successfully transitioned to its strategy to get back to growth, and other transformation goals have made amazing headway, he said about his time at the firm.