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HSBC Shenyang: N.E. China generates opportunities for banks
By Wu Yong and Liu Ce (China Daily Liaoning Bureau)
Updated: 2009-04-29 16:28 Editor's notes: HSBC Shenyang Branch is the first branch of HSBC China which opened after becoming locally incorporated in 2007. After 18 months of operations, the branch has become profitable. In 2008, the branch's customer deposits grew by 50% from a year before. In November 2008, HSBC opened its first sub-branch in Shenyang and launched debit cards. Xiong Ziwei, former deputy branch manager of HSBC Xiamen Branch, took up his new role in July 2008. Recently, he sat down with China Daily reporters Wu Yong and Liu Ce to share his view on a wide range of topics, including competitive advantage, growth outlook and corporate social responsibilities. Q: What services does your branch provide and who are your customers? A: Regardless of whether they are banking with foreign or Chinese banks, customers can enjoy almost the same range of banking services. Our services are offered to customers of all categories including foreign invested enterprises (FIEs), domestic corporations, and overseas and local residents, in both foreign and local currencies.
For our branch, multinationals remain a major customer segment, while we also have a fairly large portion of domestic companies in our customer base, especially those large state-owned equipment manufacturers with whom we have established good business relationships. On the personal financial service side, we focus on Premier Service, which is HSBC's worldwide wealth management proposition for retail banking customers. This service is quite popular in Shenyang as 94% of our Premier customers are local residents. We plan to launch home mortgage loan services in the second quarter of this year to provide our customers with more options. Q: What is HSBC's competitive advantage over your competitors? A: Foreign and domestic banks have their own strengths and can complement each other's businesses in the overall market. Domestic banks are very competitive in terms of their networks, talent, customer base and technology. International banks can not replace the networks and services offered by local banks. Our competitive advantage lies in our global network and resources. With around 9,500 offices in 86 countries and territories, we are able to provide our customers with tailored products and services that can help offer Chinese corporations better access to overseas markets, and offer overseas companies improved access to China. For personal financial services, HSBC Premier gives customers recognition and access to privileged services at more than 300 International Premier Centres located in major cities around the world, and more than 6,000 branches with Premier Service stops. An HSBC Premier customer in any country or region can enjoy recognition by HSBC Premier Centres worldwide. This unique proposition is well positioned to meet the needs of our customers who are engaged in cross-border activities. Q: How has your branch been performing since opening? A: In spite of the effects of the global financial crisis on the China market, HSBC China continued to register strong growth in 2008. As one of HSBC China's 19 branches, Shenyang Branch also achieved solid performance. At the end of 2008, we increased our customer base by over 160% from a year ago, with deposits up 50% and loans 4.5 times greater than the previous year. This healthy business growth helped us become profitable only about 18 months into operations. Exciting achievements in 2008 also included the opening of our first sub-branch in November, and at almost the same time we launched debit cards that enable HSBC China's card holders to access China Unionpay's domestic and overseas networks in about 50 countries and territories. HSBC-branded ATMs in 40 countries and territories also support the debit cards. This new service has become very popular among our retail customers in Shenyang. Q: How has HSBC been affected by the financial crisis? A: At the centre of the financial turmoil, banks are inevitably affected in one way or another. But, as our Group Chairman Stephen Green put it in the 2008 results statement, we have built our business on a very strong foundation and are able to report results which demonstrate our ability to withstand the storm. In China, we continued to register strong growth last year, driven by China's stimulus efforts which enabled continued economic growth and market confidence amid the global financial crisis. HSBC China remains one of the locally incorporated foreign banks that have the strongest capital base and highest credit rating. Q: How do you see Liaoning's economy, which is relatively less internationally oriented, doing amid the financial crisis? A: We noticed that the financial turmoil didn't have significant impact on China's Northeastern region when compared to other regions such as the coastal areas. For some local companies, there have even emerged opportunities. The local government has taken effective measures to stimulate the economy and help companies sustain growth in this difficult time. We are pleased to see that these measures are taking effect. Q: How can HSBC benefit from these measures? A: The stimulus measures generate opportunities for both local and foreign banks. We are keen to participate in the projects that can help contribute to economic growth. Some of the measures can directly benefit financial institutions such as incentives for establishing new financial institutions or increasing lending to the local market. Q: Does your branch plan to add new outlets this year? A: Upon regulatory approval, we plan to open our second sub-branch in the third quarter of this year. We are now looking for suitable property. In addition, we shall continue to invest in human resources and training to support our expanding operations. Q: What will HSBC do to respond to the government's stimulus package? A: As I said earlier, we are keen to participate in projects falling under the government's stimulus package and will continue to expand lending to support local economic growth. We believe that in order for this stimulus to work effectively, banks, both foreign and domestic, have an obligation to contribute to economic expansion by continuing to lend. For HSBC, we will maintain prudent risk controls while individually evaluating each loan application. At the same time, we will continue to deepen our relationships with our customers. Q: What is the outlook for your business for this year? A: We expect to continue to grow our business this year, although our expectation will be slightly conservative. This does not mean that we are not confident in the local market, but because we are still at the initial stage of investment, including network expansion and human resources development. In addition, we also must take into account the fact that there are still uncertainties in the global economic environment. We see great potential in Shenyang, which has achieved rapid growth in recent years thanks to the central government's endeavors in rejuvenating the Northeastern region. This progress has been providing us with lots of opportunities and we are confident in Shenyang's future. Q: How is HSBC doing in respect to CSR? A: With a strong commitment to corporate social responsibility, HSBC supports extensive educational, environmental and charitable projects and has made accumulated donations of more than RMB300 million in Chinese mainland. In Shenyang, we are also very active in CSR, with an accumulated donation of more than RMB1 million so far to support mainly education and social welfare, including the Liaoning University HSBC Scholarship and the Liaoning Rural School Teacher Training Course, which is part of a HSBC program for supporting China's rural children. We've also donated to Shenyang Homeless Children Centre and Social Welfare Centre. In 2008, HSBC Shenyang Branch received an award from the city government in recognition of our support to education. We also attach significance to raising employee's CSR awareness; staff volunteer activities are always an important part of our annual work plan. |
