By Selena Li
HONG KONG (Reuters) - HSBC (LON:HSBA) plans to accelerate the expansion of its wealth business in China despite economic headwinds and is on track to nearly double its headcount by next year, its global wealth head said, as the lender pushes ahead with its Asia pivot strategy.
The bank, which makes the bulk of its revenues in Asia, also plans to expand its mainstay wealth business in India, where it re-launched private banking services last year, said wealth and personal banking CEO Nuno Matos.
"We certainly are in an acceleration mode because we are seeing the confirmation of our expectations when we started our wealth journey in China onshore," Matos told Reuters on the sidelines of the HSBC Global Investment Summit in Hong Kong on Tuesday.
HSBC has hired around 1,700 wealth managers in China since 2021 under its digital hybrid wealth project Pinnacle, and is on track to boost that to 1,900 by the end of this year and meet a target of 3,000 by 2025, he said.
This is in addition to the 100 private bankers HSBC has recruited across in China and "a significant number of employees" brought in from Citigroup, which sold its mass affluent unit in the country to HSBC last year, Matos said.
The bank's expansion in China comes amid mounting concerns about prospects for the world's second-largest economy as Beijing grapples with an unprecedented debt crisis in local municipalities and in the property sector.
Despite the expansion, HSBC's wealth and personal banking unit, which accounted for 38% of the bank's profit last year, posted an operating loss of $90 million in China last year, underscoring the long journey to break even.
"In China, we are investing for the future. It's a market that demands you to be patient, and persistent. Many components of our (wealth and personal banking) business in China already are profitable," Matos said.
Besides wealth, the business unit's offering in China include retail banking, asset management, and insurance.
HSBC is also betting on a robust Indian economy to further boost its wealth business there.
It has hired about 50 relationship managers and investment counsellors since it re-launched its India private banking unit last July, Matos said.
"In terms of speed (of business growth), India is really flying at the moment."
The bank's Asian wealth hubs - Hong Kong and Singapore - continue to benefit from growing numbers of China's high net worth individuals investing overseas. Singapore also is benefiting from Middle East clients seeking to diversify, he said.
About 40% of the wealth flowing out of the United Arab Emirates, where the bank launched its onshore private banking business two years ago, went into Asia, Matos added.