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HSBC to invest $17bn to advance growth and boost new technologies

BBR Staff Writer Published 12 June 2018

HSBC has unveiled plans to invest $15bn-$17bn to advance growth in Asia and promote new technologies.

HSBC Group chief executive John Flint has announced the new growth strategy, which will be supported by eight strategic priorities.

Flint said: “After a period of restructuring, it is now time for HSBC to get back into growth mode. The existing strategy is working and provides a strong platform for future profitable growth.

“In the next phase of our strategy we will accelerate growth in areas of strength, in particular in Asia and from our international network.”

HSBC said it is targeting return on tangible equity (RoTE) of greater than 11% by 2020 and intends sustain dividends at current levels.

The company will use the investment to speed up growth in Asian franchise, including strengthening its operations in Hong Kong and China’s Pearl River Delta (PRD) region.

HSBC is also planning to expand its insurance and asset management services in Asia, as well as strengthen its operations in the Association of Southeast Asian Nations (ASEAN) region.

HSBC will also use the investment to complete the establishment of the UK ring-fenced bank, increase mortgage market share, grow commercial customer base and improve customer service.

Other strategic priorities include: gain market share, deliver growth from international network, turn around US business, improve capital efficiency, redeploy capital into higher-return businesses and create capacity for increasing investments in growth and technology through efficiency gain.

In addition, the firm will use investment to advance digital capabilities, establish partnerships, safeguard customers, deliver industry-leading financial crime standards and simplify the organization.

The firm intends to deliver mid-single digit growth in revenue and low to mid-single digit growth in operating expenses to achieve the financial targets in the period between 2018 and 2020.

HSBC provides banking and financial services to the customers in 67 countries and territories in Europe, Asia, North and Latin America, and the Middle East and North Africa.

Image: The world headquarters of HSBC in Canary Wharf, London. Photo: courtesy of Michael Pead.