HSBC has accelerated hiring plans for its wealth management business in China this year, as part of the lender’s big bet on rising incomes and wealth in Asia, according to Nuno Matos, the global head of the bank’s wealth and personal banking business.
In his first interview since relocating to Hong Kong, Matos said the bank had hired for about 400 client-facing roles for its mainland digital wealth planning venture, known as HSBC Pinnacle, and will have about 700 personal wealth planners on the ground by the end of the year.
The hiring spree, part of a US$3.5 billion investment in its Asian wealth business over the next five years, comes as Beijing moves to further open its financial sector to foreign banks, including through the newly unveiled Wealth Management Connect scheme in the Greater Bay Area.
“That investment is going exactly at pace. The investment is being delivered to improve our platforms for private banking, for affluent wealth, to put everything we do in mobile,” Matos said. “Our ambition to be the leading Asian wealth manager is coming to fruition. We are already the leader in Hong Kong. We want to be the leader in Asia by 2025.”
Matos is one of four senior executives shifting to Hong Kong from London this year as part of the bank’s latest pivot to Asia under CEO Noel Quinn.
In the first half, revenue from HSBC’s Asian wealth business rose 26 per cent and global wealth balances, driven by Asia, increased by 18 per cent to US$1.7 trillion. Adjusted profit before tax in the wealth and personal banking business more than doubled to US$3.86 billion in the first half, compared with US$1.66 billion in the year-earlier period.
The bank, the biggest of Hong Kong’s three currency-issuing lenders, plans to hire for 1,000 roles across Asia as it seeks to add 5,000 personnel in the region by 2025.
As China further opens it financial markets, HSBC and its competitors are preparing for the start of the Wealth Management Connect scheme, which will allow 300 billion yuan (US$46.5 billion) in fund flows between nine cities in Guangdong province and Hong Kong and Macau. The first products could be launched as soon as October.
“It is a pilot phase initially. Over time, the intention is clear,” said Greg Hingston, HSBC’s Asia-Pacific regional head of wealth and personal banking. “This is going to continue to open up, hopefully, and provide the kind of breadth of investment options for those nine cities in the mainland you can get out of an international financial centre like Hong Kong.”
HSBC is also in search of potential acquisition targets, with Quinn saying in August that it could make three to four potential “small bolt-on acquisitions”.
Last month, HSBC agreed to acquire the Singapore insurance business of French rival AXA for US$575 million, with a focus on strengthening the distribution and product base for its wealth business in the city state.
Matos said the AXA acquisition, which was awaiting regulatory approval, could be similar to Pinnacle in China, expanding its reach beyond its traditional branch network. The AXA transaction adds employee benefits and health coverage to its product mix in Singapore and gives it access to a large prime agency base.
Singapore’s central business district Photo: Bloomberg
“What I can tell you is we will combine all of our organic efforts, which will continue to be most of what we do, with some bespoke acquisitions where we believe there is a perfect fit for our strategy and where there is value for our shareholders,” Matos said. “We are on the offence. We said we want to pivot to Asia. This is just highlighting we really mean it. We are doing what we said we would do.”
Despite announcing its exit from the American mass-market retail business in May, HSBC continues to invest and expand its products for affluent and high-net-worth individuals in New York and its other international wealth hubs, such as Hong Kong and Singapore, Matos said.
“This is part of our strategy. In order to be a leading Asia wealth manager, we need to be one of the global wealth [management] providers,” Matos said. “As we allow for customers in Asia to diversify into other parts of the world, and as we allow for customers in other parts of the world to invest in Asia, those two corridors have been absolutely key to us. That’s why it’s Asia wealth as our passion within a global context.”Internet Explorer Channel Network