In many households (and many cultures, for that matter) talking about money is gauche, but HSBC is one company that has made a business out of doing just that. With a number of brands housed under the HSBC umbrella, this financial institution brings services to the entire world, connecting opposite ends of the globe.
Behaving Locally, Working Internationally
HSBC was founded on the idea that a local bank could perform international services, and that’s exactly what they have done. This institution consists of four individual global businesses, and works to ensure that its clients are connected with the best possible opportunities to foster their financial growth.
These four businesses are commercial banking, retail banking, private banking, and global banking and markets. Retail banking is the only one of these services which can assist the average individual; private banking is geared toward very wealthy individuals and their families, whereas the other two sections are meant to assist businesses of varying sizes.
Fostering Connection from the Start
In 1865, the very first HSBC opened in Hong Kong with the intention of connecting trade between Europe and Asia, hence the name HSBC, which stands for Hongkong and Shanghai Banking Corporation. This refers to the original member location of the institution.
The banks enjoyed a great deal of early success, quickly expanding to new locations throughout Asia, which allowed them to foster trade more easily with Europe, and even America. HSBC grew significantly by fostering governmental loans for China, but both world wars took a toll on the institution.
In the 1970s, HSBC recognized that they needed a strong presence in three major markets: Asia-Pacific, the U.S., and the U.K. This led to a number of acquisitions in order to strengthen their presence in the latter two. Now HSBC operates in 65 countries with 238,000 employees and more than 40 million customers.
Banking Against the Big Four
In the U.S. there are a group of financial institutions that rank above all others known as the Big Four; this includes J.P. Morgan Chase, Bank of America, Wells Fargo, and Citigroup. These institutions undoubtedly make up the biggest threat for HSBC.
While the first three institutions on that list have valuations tens of billions of dollars higher than HSBC’s, Citigroup actually comes in about $13 billion lower, asserting that HSBC is a true powerhouse in the financial world.
Global Citizen Ads Spark Questions
An ad campaign started in late 2018 has increased HSBC’s visibility to be sure, but has also brought about the attention of a not-so-positive sort. The campaign features both TV and poster advertisements with the central theme “we are not an island” meant to encourage a sense of connection.
However, a number of interested parties took the meaning of the ads to criticize Brexit, a move that many felt was hypocritical on the part of HSBC. The institution stated that there was no hidden political message in the campaign, but many remained unconvinced.
HSBC fell two spots from 88 to 90 on the Fortune Global 500 for 2018, and it remains to be seen whether that position will fall further for 2019, despite rapidly rising profits.
Establishing a system of trade across the world was a tall order in the 19th century, but HSBC got it done, and continues to reach for that connectivity today.