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HSBC chief executive Stuart Gulliver: doesn't have the solution. Photo: Reuters
Opinion
Jake's View
by Jake Van Der Kamp
Jake's View
by Jake Van Der Kamp

For HSBC globally, God is in London and so are his 19 chief archangels

I can hear the sigh of regret at that shareholders' meeting among older investors who remember the Hongkong Bank of yore when you bought the shares and locked them away because the share price only went up and the birds sang and the sky was blue.

Mr Gulliver says the bank cannot go back to those days because it would lose the custom of big companies and become much smaller. This was not an unwelcome outcome to a certain other Gulliver on his travels, but I suppose we must regard the present one as a better judge of the present situation.

I am not completely sure of it, however. All these big banks love the idea of branded customers, of having a monopoly on financial services to any number of big global companies.

Trouble is, I don't know of quite as many big companies that are quite as big on the idea as the banks are. The companies tend to like horses for courses. They pick and choose to find out who does what best.

In fact, it may not even be possible to run a full-service, fully integrated bank everywhere across the world with a standard product and standard operating procedures. I have certainly yet to hear of a consistently successful example of it being done.

The 2008 financial crisis in America, for instance, showed that the financiers who tried it there had only built ramshackle empires that they could not control, did not even know well, and that soon crumbled. Where are you now, Sandy Weill? What would you be, Citigroup, without the US taxpayer to pick up US$300 billion plus of duff assets?

And I am not sure that HSBC is the best candidate to make a success of trying it. The bank that Michael Sandberg built is a casserole of a chunk of this here, a slice of that there and a pinch of something else from Timbuktu, all jammed together as what airport gangways tell us is the world's local bank, whatever that means.

But it has never really been given time to settle down as one thing, and not much prospect that it will when Mr Gulliver says, "There is a group of basically 20 of us at the centre who run the firm globally."

Tell that to the branch manager in Istanbul. God is in London and so are his 19 chief archangels. They know all and see all. Who are you?

It does not keep the denizens of the nether regions away. To regulators across the world, HSBC is a big fat target with "Hit me" written on its chest and no protective big government to tell them to back off.

I have an HSBC account in Canada, have had it for 20 years with the same account manager, and last year the fear of God was upon him. An archangel had descended with threats if even one tick mark went awry on the money laundering check sheets.

It seems to be the present strategy. When regulators attack, archangels duck and blame all on the lower ranks. I have said it before and I shall say it again. I don't think Stuart Gulliver has done a particularly good job of standing up for his people, Western operations or anywhere.

And then you get the bickering in the lower ranks. Every six months or so I get a letter that says, "Hi, I'm Margarine Wong/Sugar Cheung/Lonely Poon and I'm your new Premier account relations manager."

Translation: The HSBC Aberdeen office objects to branches in Central holding account responsibility for residents of the south side of Hong Kong Island and has staged a dawn raid again.

I don't blame them. They are paid on performance. It's the doing of the archangels in London in the end. That's how HSBC is run globally, set at each other's throats.

No, I don't have the solution but I don't think Stuart Gulliver has it either.

This article appeared in the South China Morning Post print edition as: God is in London, as are his 19 chief archangels
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