HSBC expands to central region

Thomas Tobin (3rd, R), CEO of HSBC Vietnam, and colleagues cut the ribbon at the opening of the bank’s Danang branch on Thursday - Photo: Courtesy of HSBC

HCMC – HSBC Vietnam on Thursday opened a branch in Danang City to expand its geographical reach to the central region.

This is the second branch which the foreign bank has set up this year. The bank’s first branch debuted in Can Tho City in southern Vietnam’s Mekong Delta just last week.

Thomas Tobin, CEO of HSBC Vietnam, said in a statement, “Given Danang’s positioning as one of the country’s fastest-growing economic centers, as well as one of the most attractive hubs for foreign investment, we are looking forward to playing a role in this dynamic city’s exciting business sector.”

With the new branch at the Indochina Riverside Tower, 74 Bach Dang Street, Hai Chau District, corporate customers in Danang and neighboring provinces can gain access to HSBC’s business banking products, including commercial banking, global banking, payment and cash management, and trade finance, among others.

HSBC also has a range of personal financial services available for individual clients, including deposits and savings account transactions, loan products, international credit and debit cards.

Like other outlets across Vietnam, the Danang branch is launching a nationwide “Great Offers” promotion, offering customers discounts, bonus interest rates, and gifts across HSBC’s personal financial services products until October 31 this year.

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Upside risks on Vietnam inflation remain: HSBC

HCMC - HSBC in its latest report on Vietnam economy issued on Tuesaday said the upside risks on inflation in Vietnam still remained despite the target to contain inflation at 8% this year is to be obtained.

The downward trend in year-on-year consumer price index (CPI) growth stretched into August as the headline inflation moderated for the fifth straight month, coming in at 8.18%, which was also the slowest pace since February, HSBC said.

The bank’s researcher explained that seasonally adjusted data show that inflationary pressures have in fact intensified in recent months, with the CPI up 0.5% month-on-month in August compared to a 0.1% rise in July. More worryingly, seasonally adjusted month-on-month food price inflation accelerated from 0.3% in July to 1.1% in August, the writer said.

“As a recent tropical storm damaged rice fields and crops, food prices may continue to rise in the coming months, making the Government’s task of keeping inflation in check more difficult,” said the report.

In addition, HSBC said that with total depreciation of about 10% on Vietnam dong since November last year, the Government should be mindful of strong import-led inflation.

Policymakers are going to implement price controls on selected items sold by foreign and private firms, which will be effective on October 1. However, the foreign bank’s researcher commented that this move may help control the pace of inflation, but it would certainly come with side effects, especially damage to business sentiment.

The foreign bank expected that curbing inflation is likely to remain an important item on the policy agenda in the near term.

“Not only does high inflation upset macro stability, it also weighs on the country’s economic prospects by hurting investor confidence,” HSBC said.

Meanwhile, although not the sole reason, high inflation is partly responsible for the low savings rate in Vietnam. The bank said that deposit rates in Vietnam tend to lag behind inflation, with real rates often in negative territory, which discourages savings.

“Low savings is in turn a concern, as investment still predominantly has to be funded by foreign sources, making the economy particularly vulnerable to external developments,” said the researcher.

HSBC report said that Vietnam’s trade and inflation concerns would not go away just yet. However, the Government seems keen on addressing existing economic shortcomings to improve the country’s growth prospects.

“The economy’s long-term outlook therefore remains positive so long as policymakers continue to prevent trade blowouts and inflation from running high, both of which remain the biggest risks facing Vietnam,” said the report.

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HSBC warns UK bank break-up could force exodus

LONDON - HSBC Holdings, Europe's biggest bank, warned that Britain's big banks could move overseas if a government review decides that lenders should be broken up.

Stuart Gulliver, head of investment banking, said HSBC was "genuinely concerned" that a UK government appointed commission would recommend big banks must split retail banking from riskier investment banking.

Gulliver said it was "clearly possible" the Commission will recommend a break up, which could have implications for itself, Barclays and Standard Chartered.

"That has significant implications for where we may choose to headquarter our institution and that would probably also be the case for the other two institutions," Gulliver said at a conference held on Thursday, which was webcast.

"Our absolute wish is to stay here in the UK, but we won't know until we see how the Commission responds."

HSBC Chief Executive Michael Geoghegan moved to Hong Kong earlier this year to be in the bank's key region.

The CEO of Asia-focused rival Standard Chartered warned last month that the rationale for keeping its headquarters in London was weakening as UK banks face being at a disadvantage to rivals on taxes, pay and regulation.

Gulliver also said he expects HSBC's annual profit in the Middle East, which plunged to $455 million last year from $1.7 billion in 2008 due to troubles in Dubai, should recover to between $1 billion and $1.2 billion by 2012 at the latest.

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HSBC warns UK bank break-up could force exodus

LONDON - HSBC Holdings, Europe's biggest bank, warned that Britain's big banks could move overseas if a government review decides that lenders should be broken up.

Stuart Gulliver, head of investment banking, said HSBC was "genuinely concerned" that a UK government appointed commission would recommend big banks must split retail banking from riskier investment banking.

Gulliver said it was "clearly possible" the Commission will recommend a break up, which could have implications for itself, Barclays and Standard Chartered.

"That has significant implications for where we may choose to headquarter our institution and that would probably also be the case for the other two institutions," Gulliver said at a conference held on Thursday, which was webcast.

"Our absolute wish is to stay here in the UK, but we won't know until we see how the Commission responds."

HSBC Chief Executive Michael Geoghegan moved to Hong Kong earlier this year to be in the bank's key region.

The CEO of Asia-focused rival Standard Chartered warned last month that the rationale for keeping its headquarters in London was weakening as UK banks face being at a disadvantage to rivals on taxes, pay and regulation.

Gulliver also said he expects HSBC's annual profit in the Middle East, which plunged to $455 million last year from $1.7 billion in 2008 due to troubles in Dubai, should recover to between $1 billion and $1.2 billion by 2012 at the latest.

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HSBC in talks to buy majority stake in Nedbank

Asia-focused banking giant HSBC announced on Monday that it is in "exclusive" talks with insurer Old Mutual over the potential purchase of a controlling stake in South Africa's Nedbank

LONDON – Asia-focused banking giant HSBC announced on Monday that it is in "exclusive" talks with insurer Old Mutual over the potential purchase of a controlling stake in South Africa's Nedbank.

"HSBC Holdings plc has entered into exclusive discussions with Old Mutual plc about the possible acquisition of a majority stake in Nedbank Group Limited, South Africa's fourth largest banking group by total assets," HSBC said in a brief statement to the London Stock Exchange.

"The discussions are ongoing and if successfully concluded would be conditional on, among other matters, obtaining the necessary regulatory approvals."

In a separate statement, Old Mutual revealed that it has received a proposal from HSBC to buy up to 70 percent of Nedbank shares, but did not reveal the price.

Old Mutual added that the proposed deal would be a "major step" in its strategy to reduce the group's complexity, adding that the proceeds would be reinvested and used to cut debt.

Meanwhile, the Financial Times newspaper reported on Monday that HSBC had fended off competition for Nedbank from British-based emerging markets lender Standard Chartered.

The daily business newspaper, which cited people familiar with the talks, added that HSBC's proposed Nedbank deal could lead to a full takeover offer.

HSBC, which is seeking expansion in emerging markets, agreed last month to buy the Indian commercial and retail banking assets of Britain's state-controlled Royal Bank of Scotland.

 

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