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  • Topic: HSBC, The Hongkong and Shanghai Banking Corporation, Midland Bank
  • Pages : 8 (3262 words )
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  • Published : May 2, 2009
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The Hong Kong and Shanghai Banking Corporation, better known as HSBC, has a history that dates back to its inception in 1865. Initially started to facilitate the trade among Europe and China, but quickly became what they market themselves to be; “The World’s Local Bank”. With more 9,500 locations in 86 different countries, HSBC is one of today’s leading financial institutions. It is safe to say that HSBC has embraced the idea of globalization to its utmost potential by developing strategies to infiltrate each market in a unique way. Although HSBC operates all over the world, its products and services are consistent in delivering the latest financial solutions for individuals as well as corporations. Taking into consideration the particular cultural characteristics of each country has helped HSBC to effectively grasp the needs of the consumers they are targeting. Maintaining a local feel with local knowledge is part of HSBC’s strategy to develop relationships with customers while building brand loyalty. As the banking industry recovers from the economic downturn we are currently facing, the intelligent business decisions made by HSBC has maintained them as one of the strongest and most stable financial institutions we have today. Through globalization HSBC has been able to build their empire by being able to expand quickly and thus growing at a faster rate than those that remain national. HSBC’s efforts to enter global markets began with a vision for financing trade through a large bank instead of hongs, or a European trading house. Thomas Sutherland was the man with this vision of having a more professional financial institution to facilitate these transactions, and on April 3rd 1965 Hong Kong Shanghai Bank opened its doors. Soon after the bank opened it began establishing agents and contacts around the world including North America and Europe although HSBC’s primary focus was doing business in China. Within 10 years the bank had opened branches in Malaysia, Singapore, the Philippines, Sri Lanka and Vietnam; making it Asia’s and India’s primary financial institution. After the Second World War HSBC played a pivotal role in the reconstruction of Hong Kong and invested in the manufacturing industry which in turn tripled the banks total assets. Today the bank is threatened by competition and the economy but HSBC retains a competitive advantage over other financial institutions which is the availability of accessing your funds in many parts of the world. HSBC’s benefited from China’s mega economic boom making the country a more prosperous one and opening its doors to do business in the America’s. The bank also has benefited from access to the most up to date technological advances which aids in maintaining a strong operational department. Although there are many benefits to globalization there is also a cost associated with them. Since HSBC has spread their business to many parts of the world they are susceptible to the detriments of the economy in that particular country. Currently we have seen how inflation affected the mortgage industry and corrupt, power hungry bankers stole money from an institution whose base should be honesty. The irresponsible actions in the United States have affected the world and HSBC has not been immune to it. HSBC achieved regional integration by acquiring licenses to operate in several cities and offering products that were before limited to specific companies. They acquired several major institutions including Midland bank, from London and CCF, Crèdit Commercial de France in the 1990’s which introduced HSBC to the European market. HSBC’s efforts to operate in foreign markets began way before globalization efforts sky rocketed. In 1865 an office of HSBC was located in California and although its initial intentions were not to expand the merger of Midland Bank in 1987 sparked a change in the way business was done. Midland bank focus was on commercial and personal banking operations and...
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