HSBC beats its China wealth recruiting targets and considers re-entering India's private banking market.
As part of its goal to make Asia and wealth major pillars of development, HSBC Holdings Plc is ahead of its hiring plans for its Chinese retail wealth management company and is considering re-entering India's private banking business, according to top executives.
HSBC is investing $3.5 billion in its wealth and personal banking division as part of a strategy led by Group CEO Noel Quinn, with the goal of becoming Asia's top wealth manager by 2025.
"We want to exploit that opportunity because we are the premier foreign bank in China," said Nuno Matos, the bank's CEO of Wealth and Personal Banking, who is one of four top executives heading to Hong Kong from London this year as part of the firm's regional expansion.
"We are now indefinite expansion mode on the private banking side," Matos told Reuters in one of his first interviews since arriving in the region.
Asia is HSBC's largest market, with the wealth and personal banking segment accounting for 44 percent of the London-based bank's adjusted global revenue last year, or $22 billion.
According to Matos, the bank plans to expand its mobile wealth planning service, HSBC Pinnacle, in China by having roughly 700 personal wealth planners by the end of the year, up from the 550 originally envisaged.
Investments, insurance, and asset management products are among HSBC's wealth management services, while private banking caters to clients with investible assets of $5 million or more.
According to Siew Meng Tan, head of HSBC Private Banking for the Asia Pacific, the bank had 20 personnel working in China's onshore private banking sector at the end of last year.
"We'll get to 64 by the end of this year, and by the end of next year, we'll have doubled that," she said.
HSBC is considering re-entering onshore private banking in India, where the ranks of the ultra-wealthy are rapidly rising and record-high stock markets have spawned a slew of billion-dollar start-ups.
As part of a group strategy, HSBC exited the Indian private banking sector in 2015. There are few international companies in India's affluent but fiercely competitive business.
HSBC is currently focusing its global headquarters in Singapore, London, and the Middle East on serving wealthy Indians.
HSBC is also trying to expand its footprint in Singapore and Southeast Asia, according to Matos. The bank paid $575 million for the Singapore assets of French insurer AXA in August.
Though HSBC has a strong retail banking presence in Asia, particularly in Hong Kong's financial center, global leaders such as UBS and Credit Suisse dominate the market for wealthy clientele.
Despite an unprecedented regulatory crackdown in the world's second-largest economy, global wealth managers remain optimistic about China's development prospects.
In a June analysis, Boston Consulting Group predicted that Asia's wealth management revenue pools will grow faster than any other industry in the globe, nearly tripling to $52 billion in the next five years.
"Asia's economy is growing at twice the rate of the rest of the globe. For us, this is a fascinating potential "Matos, who took over HSBC's newly integrated division in February, said this.
"I'm not going to re-do our goals right now," he said, "but I can tell that in 2021, we will over-deliver on our wealth ambitions."
HSBC is also keen to obtain full control of its asset management company in China, Matos added, after announcing intentions to buy out its life insurance joint venture partner in the nation last year.