HSBC targets five ‘billion dollar’ markets in Asia

A sharper focus on building scale at a faster pace in the region’s fast-growing markets is a key part of the strategy articulated for Asia in the HSBC Group Strategy Day held in London recently.

“As Asia’s global bank, HSBC will cement our leadership in the region by growing aggressively in key markets as we continue to lead in greater China. We have a solid platform for growth and a proven track record to deliver on our strategy to build a balanced and diversified business in Asia. Our distinct ability to connect customers to global opportunities in trade, investments and wealth will drive our ambitions in the world’s strongest economic region,” said Peter Wong, chief executive of HSBC in Asia-Pacific.

Three areas of focus to drive growth: expand leadership in greater China; build scale in key markets comprising Hong Kong, mainland China, Australia, India, Singapore, Malaysia and Indonesia; and strengthen cross-border capabilities to lead in international connectivity.

HSBC is the largest foreign bank in greater China with over 270 outlets across mainland China, Hong Kong, Macau and Taiwan. In Hong Kong, where the Bank delivered profits of $1.6 billion and grew revenues by 8 per cent in the first quarter of 2011, HSBC holds the largest market share in deposits, credit cards, mortgages and local bonds. HSBC aims to break into new leadership segments such as insurance and equity capital markets while capturing opportunities from the emerging mass affluent Chinese and businesses with international needs.

In India, where HSBC made nearly $700 million in 2010, the bank is aiming to reach $1 billion in profit before tax in the medium term.  As Singapore strengthens its position as a regional wealth and trading hub, HSBC plans to add relationship managers for Premier and Private Banking while expanding its structured trade finance capabilities to reach its $1 billion profit ambition in this market.

HSBC also aims to generate $1 billion from Malaysia and Indonesia combined in the medium term, as the bank strengthens its Islamic finance capabilities and builds on its recent investment in Bank Ekonomi to expand relationships with Indonesia’s significant SME segment.

Australia is also seen as a priority market with its increased trade connections with greater China and its growing mass affluent population with Chinese linkages, providing HSBC with a clear competitive advantage to lead in the international banking segment.

Wong stressed that stronger connectivity with mainland China will not only redefine the strategy for HSBC’s business in Hong Kong, but will become a key driver of revenues across HSBC’s network in Asia and globally as HSBC currently works with 60 per cent of the top 100 Chinese companies with overseas investments.