HSBC bid to close Middle East link
HSBC Group is one of the world's largest banks, although the average Egyptian might be forgiven for not knowing this. But not for much longer.
The bank is bidding to increase by 11 per cent its 40 per cent stake in the Cairo-based Egyptian British Bank (EBB) and aims eventually to buy up the remaining shares.
With assets of US$935 million, EBB is one of the largest privately owned banks in Egypt, and acts as the main bank there for multinational companies directly or through their local subsidiaries. Hence its attraction to HSBC.
The Egyptian economy, too, is opening up and achieving sustained growth, said Andrew Dixon, deputy chairman of HSBC Bank Middle East.
'We see considerable scope for introducing a range of HSBC's wealth management services to this important regional market,' he said.
But a much more pressing reason is that Egypt, along with Saudi Arabia, is a missing link in HSBC's dominance in the Middle East.
Its subsidiary HSBC Bank Middle East is the most widely represented international bank in the region, with 29 branches in United Arab Emirates, Oman, Bahrain, Qatar, Jordan, Lebanon and Palestine, but only associated bank links to the much larger countries of Egypt and Saudi Arabia.
US banks such as Citigroup are fast gaining ground in the region.
By launching its red and white hexagon brand in Egypt soon, HSBC hopes to grasp the emerging middle-class personal banking requirements, and use its success in neighbouring countries to secure Egyptian corporate business.
Business customers become increasingly global and expect their banks to do so too, according to Tony Allen, managing director of British brand consultancy Interbrand Newell and Sorell. Retail customers are also increasingly global.
While most large banks offer facilities to suit customers from school age to retirement, they often lose them along the way due to a confusing mix of services and brands.
'The solution is to offer one brand,' said Mr Allen, who advised on the recent re-branding campaign for Britain's Barclays Bank.
