Investment, trade and collaboration involving both Middle East and Asia-based entrepreneurs is growing rapidly and becoming increasingly important, according to HSBC’s CEO for Global Private Banking and Wealth, Annabel Spring.
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‘The rise of Middle East wealth is obvious and compelling as an opportunity for all banks,’ said Spring, who described the flow of investment and business activity between the UK and the Middle East as ‘a traditional corridor’.
She added: ‘The corridor that is strengthening much more dramatically is the Asia-Middle East corridor. When we look at mainland China, Hong Kong, Singapore, Qatar, Saudi, UAE, Kuwait etc, there is a real desire among our clients to get to know each other. So it’s not just investment and money moving – it’s ideas and people collaborating.’
‘Some of our most popular events are when we’re bringing clients from Asia to the Middle East, or from the Middle East to Asia – to meet other people in similar businesses. That’s a strengthening trade corridor, a strengthening business corridor, and also a strengthening investment corridor. The one between the UK and the Middle East is a traditional one, and it’ll remain in place.’
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Senior HSBC economists recently projected that two-way Asia-Middle East trade could double between 2022 and 2035, reaching $1.9 trillion. The bank expects the existing flow of crude oil and LNG to be complemented by an increasing range of products such as ‘Saudi plastics and Indian pharmaceuticals’.
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Spring made her comments in an exclusive interview with Spear’s earlier this month following the announcement of HSBC’s interim results in which outgoing CEO Noel Quinn namechecked her department: ‘Our investment in Wealth is delivering higher, more diversified revenue,’ Quinn said. The bank posted a $21.6 billion pre-tax profit for the first half of the year, which was in line with the previous year’s figure.
In April Quinn unexpectedly announced that he would vacate his role as CEO, after an ‘intense’ five years in charge. The baton will be passed in September, when the bank’s current CFO – the Mandarin-speaking, Lebanese-born Georges Elhedery – will take the top job. Elhedery also underscored his support of Spring’s department. ‘It was good … to hear his ongoing commitment to the wealth business as well,’ said Spring. ‘We were all listening for it, and we heard it: great, very encouraging.’
The investment in HSBC’s wealth division has allowed the private bank to open new operations onshore in six Chinese cities, the UAE, Mexico, India and Thailand over the last ‘three or four years’, said Spring. ‘In the wealth business, we’ve really enhanced our proposition in almost every market,’ she added. This included launches in the Philippines, Vietnam, and expansion in Spring’s native Australia. Headcount in the bank’s private banking and wealth division has increased by 40 per cent since Spring became CEO in September 2020.
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As well as seeking to help make HSBC ‘the world’s most admired international wealth and banking franchise’, Spring restated her ambition to chase down UBS to become ‘the largest wealth manager in Asia’ once again. HSBC previously held the top spot, only to be overtaken when UBS increased its assets under management to $645 billion following its acquisition of Credit Suisse in 2023. (HSBC has $607 billion AUM in Asia.)
The bank’s strategy will be driven by the global flow of wealth, Spring said. ‘You can be fundamentally guided by where you think wealth is moving in the world. So if you look at the data and you say, “Okay, where is wealth growing very rapidly?” Obviously, Asia is significant. The Middle East is significant. But you have to continue to invest in Europe. Switzerland‘s historically been the biggest booking centre for offshore wealth in the world.’
The UK remains one of the bank’s two ‘home markets’ (alongside Hong Kong), its ‘regulatory home’ and ‘an area for considerable investment’, said Spring. She added that changes to the UK’s non-dom rules were unlikely to change this: ‘The UK will always be an attractive place to live and to work and to invest.’ UK private banking clients are served from HSBC’s discreet office on Cork Street in Mayfair by a team that includes Spear’s Top Flight UHNW wealth manager Charlie Hoffman. In June last year the group announced that it would relocate its main London headquarters from the one million square foot 8 Canada Square in Canary Wharf to a site roughly half the size in the City of London.
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Some 60 per cent of the bank’s private banking and wealth clients come via existing relationships with HSBC, often through ‘the business bank’ or through its employee banking proposition. ‘I always joke that, the private bank – and, by extension, wealth – is kind of the emotional heart of HSBC,’ said Spring. ‘We get to lever on all of the relationships of the business bank. Historically, that’s been a huge part of our new client acquisition.’
Asked what potential UHNW clients should understand about the HSBC offering, Spring said: ‘Their world is global, and so is ours. We can provide access, whether it’s for their businesses, or for their personal lives, or for investing globally.’
By way of example she described a client she had recently had lunch with, who is based in Dubai, banked in two European booking centres, has HSBC business banking throughout Asia, and is now sending their child to school in America. ‘Our conversation was about making sure that he could buy a property in the US, have a credit card and an account for his child. We can do his private banking in the two booking centres, we can do his business banking in Asia. And now his kid is going to school, he needs to think about wealth planning. So it’s business banking, it’s retail banking, it’s private banking, it’s succession planning – across five different markets. That’s what we do.’
