The Hindu Business Line : 50% of business to come from developing nations: HSBC chief

HSBC Group, the financial and banking services provider, sees about 50 per cent of its global business coming from developing countries, wherein India has emerged as a strategic market.

The Chief Executive Officer of HSBC, Mr Niall Booker, said a bank typically leverages the potential of an economy in which it operates. Therefore, for HSBC, the challenge is to select better performing economies, and India is one of them.

North America, the Euro-zone and the Asia Pacific region account for one third apiece of the bank's business that reflects the growing importance of developing economies such as India, China, Brazil and Mexico.

"We are in the process of rolling out what we call the Household Model based on sophisticated data-intensive analysis that is rapidly scalable, offering customised solutions. Using a common technology platform that is tailored to local requirements, various financial solutions are provided," he explained.

Speaking on the theme `Organising across borders' at the All-India Management Association meet on Saturday, he said, "Over the years, HSBC has emerged as the 32nd most valuable brand in the world and the next phase is to build on this brand through expansion. While being conservative, we have a stringent risk management practice that is best addressed through local management teams."

With a market capitalisation of $220 billion, HSBC is becoming a marketing and sales-led organisation building on its human capital and functioning in a matrix-driven management structure that responds rapidly, Mr Booker said. HSBC's universal banking spans 50 countries where the entire procurement process is professionally managed.

The local environment requires a different focus to cater to government rules and business practices. Thus, the execution is a local responsibility, he said, pointing out that only 30 per cent of its staff are from the UK.

"Over the next few years running up to 2009, the banking industry will witness a lot of changes, particularly regulatory. This will allow foreign banks to play a larger role, which is now restricted. The industry is set for consolidation, where a few strong private banks will emerge, and the public sector banks will see consolidation to remain competitive," Mr Booker observed.

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50% of business to come from developing nations: HSBC chief