Banking giant HSBC has plans to expand its wealth business exponentially in mainland China.
During its half-year results on 4 August, the London-headquartered bank said that it wants to reach 2,000 to 3,000 China-based wealth planners within four years after it hired 100 “digitally-enabled” wealth managers in Guangzhou and Shanghai.
The group has an initial focus on “new-to-bank” affluent clients in China through its digital wealth planning and insurance service Pinnacle.
Its growth plans have been amplified by the Greater Bay Area (GBA) Wealth Connect programme, which facilitates cross-boundary investment by GBA residents in wealth management products distributed by banks in the GBA.
The bank aims to ramp up expansion in GBA and Yangtze River Delta by 2021; and plans to obtain more platform licenses will “enable HSBC wealth businesses to collaborate in order to better serve clients”.
Political tensions
HSBC’s move into China comes at a time when levels of geopolitical risk “are expected to have economic impacts for the group”.
US-China relations continue to be under pressure, heightened by the passing of the Hong Kong national security law and the US Hong Kong Autonomy Act, as well as emerging challenges in UK-China relations.
Noel Quinn, HSBC chief executive, said in a statement: “Current tensions between China and the US inevitably create challenging situations for an organisation with HSBC’s footprint.
“However, the need for a bank capable of bridging the economies of east and west is acute, and we are well placed to fulfill this role.”
Job cuts
The China wealth management recruitment spree is also quite extraordinary timing as HSBC is set to make global job cuts.
Quinn said it will “accelerate” an earlier restructuring plan, which included axing 35,000 jobs.
“Our operating environment has changed significantly since the start of the year,” he added.
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