Opinion | HSBC should lean into its Asia pivot to have a shot at becoming ‘The Bank’ once again

Moving senior management to Hong Kong shows that HSBC is finally focusing on its home strengths instead of trying to be all things to all customers

The bank’s future is as a Chinese company, just more multinational than your average state-owned commercial bank

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A man walks through the HSBC headquarters in Central, Hong Kong, on September 21. Photo: Sam Tsang

Published: 9:15am, 26 Feb 2021Updated: 9:15am, 26 Feb 2021

It is a universally acknowledged truth that global banks are not the quickest on their feet. That doesn’t stop them using dynamic rhetoric to illustrate their strategies.

Citigroup’s then CEO, Chuck Prince, talked about his bank “dancing” just as he led it into the oblivion of the 2008 global financial crisis. HSBC describes its strategy internally as an acceleration of its “pivot to Asia” – hopefully with less-devastating consequences.

The HSBC boardroom has often mentioned rotating back towards Asia. It is unsurprising that it is has decided to run 95 per cent of its net revenue out of Hong Kong. Indeed, the city has been the engine room of its business, ever since the bank was ejected from its iconic building on the Bund in Shanghai in the 1950s.

It has been the best part of 20 years since I’ve able to say, as a private banker, “if only our clients knew that all they had to do was buy, hold and never sell HSBC shares, and just clip the coupon of the dividends, they would have no need of a private bank”.

Sadly, HSBC has stumbled from bad strategy, to mistake, to the low point of having the US authorities charge it (along with many other banks) over money laundering. In a rare achievement, the bank has been castigated in the political corridors of not only Beijing, but also London and Washington.

Peter Wong, HSBC Asia-Pacific deputy chairman and CEO, signs a petition in support of Hong Kong’s national security law. In the past year, the bank has been caught up in US-China tensions. Photo: Handout

Being at the heart of the Hong Kong moneymaking machine enabled successive HSBC leaders to have delusions of grandeur of building a global bank with businesses in all areas of banking, all over the world. Not that ambition is bad, especially as a regional bank would most probably have been snapped up by another acquisitive bank with an outsize ego.

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