HSBC to relaunch Indian private banking within a year: CEO


HSBC Holdings plc plans to restart its Indian private banking business within a year, after the Asia-focused bank has identified as a key strategic market for growth, HSBC Holdings plc’s India chief executive told Reuters on Thursday.

HSBC exited India’s private banking business in 2015 as part of the group’s strategy. The lucrative but competitive Indian market has few foreign players in a segment that caters to high--worth individuals.

The London-based bank is gearing up to reopen its operations in India, at the same time that the bank is increasing its focus on Asia, the largest region in terms of its profit generation, with Greater China and being its main market.

Hitendra Dave, chief executive of HSBC India, said: “We can see an increase in the amount of wealth created and the number of millionaires in India… Hence the decision in principle to reintroduce private banking in India.”

“We are going through an internal approval process, which take six to 12 months, which will include a full suite of private banking products,” he said in an interview.

Currently, HSBC is focused on serving wealthy Indians in global hubs in Singapore, London and the Middle East.

Nuno Matos, global chief executive of HSBC’s wealth and personal banking business, which includes private banking, told Reuters in November that the bank was exploring whether to re-enter India’s onshore private banking business.

HSBC earns slightly more than half of its revenue and about two-thirds of reported pretax profits from Asia in 2021. It has increased its focus on Asia by mobilizing global executives and pouring billions into the lucrative wealth management business.

See also  Lava will launch a "Made in India" smartphone on January 7: this is what we know

Dave said the bank also plans to its customer base in different business segments in over the next three to five years, taking advantage of shrinking business and growing wealth in the country for some foreign rivals.

HSBC India’s pre-tax profit rose 9% to $1.11 billion in from $1.02 billion in 2020, with revenue from commercial banking, which includes SMEs, rising 42%.

“The group has invested $4.5 billion into the country over the years. We have grown over the past few years without requiring additional capital and will likely continue for the foreseeable future,” Dave said.

The lender last year agreed to buy India’s L&T Finance Holdings’ mutual fund unit for $425 million and plans to increase its stake in the insurance joint venture.

“HSBC has identified as one of its top strategic markets and we have huge potential for organic growth, but we may also consider inorganic growth if opportunities arise,” said the India chief executive.

(Reporting by Nupur Anand; Editing by Sumeet Chatterjee and David Evans)