Hey Guys!
I did some research on HSBC and looked into their 2012 Annual Reports. Here is my take on the MNE profile including their strategies and background info. Post your research to this post so we can then condense and make into an official MNE Profile for our class website. Also my references are at the bottom.
HSBC Holdings was established in 1991 by The Hongkong and Shanghai Banking Corporation to perform as a new group holding company. In 2012, Forbes named HSBC holdings the world’s third largest publicly held bank and sixth largest public company. Based in London, the global banking and financial services organization had over 102 billion sales in 2012 providing services to 58 million customers covering 87 countries and territories. The bank operates in Hong Kong, Europe, Rest of Asia-Pacific, the Middle East, North America and Latin America. Their services are identified into four global businesses, Retail Banking and Wealth Management, Commercial Banking, Global Banking and Markets and Global Private Banking. As of December 31 2012, HSBC market capitalization is $194 billion up from $136 in 2011.
According to HSBC Holding plc’s Annual Review 2012, shares in HSBC holdings are held by about 220,000 shareholders in 129 countries and territories. HSBC is listed on the London, Hong Kong, New York, Paris and Bermuda Stock exchanges. In their 2012 Annual Review, HSBC defines their strategy as an “international network connecting faster-growing and developing markets.” While also developing Wealth Management Services and investing in Retail Banking only in markets where they will reap a profitable scale. HSBC operates with a global brand strategy with efforts with its popular marketing tagline “the world’s local bank.” They have recently shifted gears to know become the “world’s leading international bank.” HSBC is concentrating on growth markets as well as emerging markets where wealth is being created.
The U.K. telegraph interviews CEO Stuart Guillver’s proposition of a HSBC transformation. Guillver argues during January 2011, the firm was run as a series of countries, each head in charge of their own bank causing a disconnect, difficulty to control and mismanaged during this time. Since then, his plans have shifted to not just focus on emerging markets but to have a strong stance in developing and most importantly developed countries. Guillver states “What I don’t want to do is position it purely to be an emerging markets business. There will always be a substantial trade and capital flow between the developed world and the emerging markets, and to capture that you have to be in the developed world.”
Essentially, HSBC states in their Annual Review of 2012 that their strategy is to continue to become the world’s leading international bank. To execute their vision, the global bank relies on three areas to evolve, 1) Growing HSBC, 2) Simplifying HSBC and 3) Restructuring HSBC. Growing HSBC will be achieved by placing HSBC in a proper growth position. This means delegating capital across their home and priority growth markets, accessing emerging markets while covering all major trade corridors. To attain this, they plain to establish closer communication and coordination among their four businesses to maximize revenue. Secondly, simplifying HSBC, will allow the bank to be easier to control and manage. To do this, they have plans to eliminate 47 ineffective transactions as well as improving their organizational efficiency. Lastly, restructuring HSBC includes adapting to the changing environment specifically reshaping their U.S. operations to focus primarily on core activities such as, servicing international businesses, global private banking and improving operational standards.
Works Cited
DeCarlo, Scott. “The World’s Biggest Public Companies.” Forbes. Forbes Magazine, 18 Apr. 2012. Web. 29 Mar. 2013.
“Financial Results.” HSBC Holdings Plc –. HSBC, Mar. 2012. Web. 29 Mar. 2013.
“Gulliver’s Travels and the Transformation of HSBC.” The Telegraph. Telegraph Media Group, 3 Mar. 2012. Web. 29 Mar. 2013
HSBC. HSBC Holdings Plc Annual Report and Accounts 2012. Rep. London: HSBC, 2012. Print.
HSBC. HSBC Holdings Plc Annual Review 2012. Rep. London: HSBC, 2012. Print.
Nice, Amber! I did research on FACTIVA for some older news as supplements. Feel free to double check if the source I found is good or not.
“2 EXECUTIVES ARE OUSTED AT HSBC”
On 2007, both Bobby Mehta, the head of its North American business and as chief executive of HSBC Finance, and Sandy Derickson, chief executive of HSBC Bank USA and vice chairman of HSBC Finance, were stepping down. Then, HSBC surprised investors this month by announcing it had to increase its reserves for bad loans in US to $10.56 billion, about 20 percent more than what analysts expected. A bold speculation, this might be one of the fuses of their financial crisis which might lead them fall into laundering scandal.
Another news one the New York Times: “HSBC Subject of U.S. Money Laundering Probe ”
American authorities are investigating the U.S. division of global banking group HSBC over its compliance with anti-money laundering procedures, according to a regulatory filing, Reuters reports.
In the filing to the Securities & Exchange Commission, HSBC USA stated it has received subpoenas and other requests for information as part of the probe.
HSBC said in the filing that it was the subject of ongoing examinations by the Office of the Comptroller of the Currency, the Federal Reserve Bank of Chicago, the U.S. Attorney’s Office and the U.S. Department of Justice.
“These examinations and inquiries pertain to, among other matters, our global banknotes business and our foreign correspondent banking business, and our compliance with the Bank Secrecy Act, Anti-Money Laundering and Office of Foreign Assets Control requirements,” the filing said.
http://global.factiva.com.remote.baruch.cuny.edu/aa/?ref=NYTB000020100805e685001e1&pp=1&fcpil=en&napc=S&sa_from=
One more news from the Wall Street Journal: “Tax Crackdown Broadens; HSBC Pushed on Secret Bank Accounts in India Unit ” on 2011.
http://global.factiva.com.remote.baruch.cuny.edu/aa/?ref=WSJO000020110407e748009q5&pp=1&fcpil=en&napc=S&sa_from=
The U.S. Justice Department asked a federal court to force HSBC Holdings PLC to disclose the names of U.S. customers suspected of having secret bank accounts in India.
In court documents, the Justice Department said HSBC bankers told prospective clients that, as a foreign bank, HSBC’s India operations wouldn’t disclose their accounts to the Internal Revenue Service.
Armed with that knowledge, U.S. customers “have been able to maintain these foreign accounts with reasonable confidence that the IRS would not discover them,” government lawyers alleged.
Thousands of U.S. taxpayers of Indian origin have opened up accounts with HSBC in India since 2002, when the bank allegedly began soliciting their business, according to the U.S. government. It asked a San Francisco court to allow the IRS to serve a so-called John Doe summons against the U.K. bank’s U.S. unit, HSBC USA, to get the names of its U.S. clients with Indian accounts.
Good research, Amber – I think you explained the corporate strategy of HSBC well. I’m going to start a new post for the Environmental and Industry Analysis portion of the blog.
HEY GIRLS, THIS IS YIYI. I AM SORRY THAT I JUST RELIAZED I WAS IN THIS GROUP BLOG.SO I DIDNT GET ANY CHANCE TO READ WHAT YOU HAVE POSTED ON HERE. I AM SORRY AGAIN!!! I AM TRYING TO FIND THE INTERNATIONAL STRATEGIES AND WILL POST ON HERE.
“I WASNT IN THIS GROUP BLOG”