PETALING JAYA: HSBC Bank Malaysia Bhd remains committed to Malaysia and is strategizing its efforts to be the preferred international financial partner for its clients.
Not only would this move put one of the oldest banks in Malaysia on a stronger footing in the competitive banking space, but would also fuel its earnings growth amid the challenging business environment.
In an interview with StarBiz, the bank’s first Malaysian CEO Datuk Omar Siddiq said the country is central to HSBC Group’s strategy and is crucial to its growth plans across Asean, a region that offers significant growth potential for the bank.
“Our strategy itself supports our ambition of being the preferred international financial partner for clients. To achieve our ambition, we are directing our efforts on focusing on our strengths.
“This includes supporting the growing wealth needs of our customers and leveraging the reach and value of our global network for our corporate and institutional clients while also investing at scale domestically.
“We are also continuously investing in technology, inspiring a dynamic and inclusive culture and helping employees develop future-ready skills, and supporting clients to achieve their transition to net-zero,” he said.
Elaborating on these initiatives, he said the multinational bank would step up collaboration and cross-selling across different areas to meet clients’ personal and corporate banking needs.
Besides simplifying and optimizing processes to ensure efficiency, he said HSBC Malaysia would capitalize on its international network, a clear differentiator for the bank’s global business.
In October 2021, HSBC Malaysia signed a memorandum of understanding with Invest Penang to bring high quality foreign direct investments into Penang and Malaysia.
The bank last year also launched a collaboration with the United Nations Global Compact Network Malaysia and Brunei to strengthen the sustainability capability of mid-market enterprises.
Omar said it would continue investing in technology to digitize at scale. Apart from creating and delivering fast, easy, digital customer experiences, the bank would, among others, forge partnerships with technology innovators to enable new customer benefits.
Earlier this year, as part of its commitment to the small and medium enterprise (SME) sector, HSBC Malaysia launched the HSBC Global Wallet, the country’s first multi-currency digital wallet that enables SMEs to quickly and securely transact with their suppliers and clients globally .
“To develop, attract and retain talent, HSBC is building an inclusive organization that prioritizes well-being, invests in learning and careers and prepares our colleagues for the future of work.
“In Malaysia, HSBC’s move to Menara IQ at TRX is a reflection of the bank’s commitment to the future of work model, enabled by a hybrid work arrangement,” he noted.
When asked whether there are plans to cut down its portfolios or branches in the country, Omar said the bank is committed to its business in Malaysia.
He said a reflection of this commitment includes HSBC Malaysia’s US$250mil (RM1.13bil) investment in its new Malaysian headquarters in the financial hub of TRX.
The bank has invested US$40mil (RM180mil) from 2021 to 2023 to equip its branches with enhanced digital capabilities and new technology, he noted.
This is in addition to the US$18mil (RM81mil) that was invested from 2018 to 2020 to further develop innovative branch formats and champion new ways of serving customers while supporting their financial journeys.
Leveraging HSBC’s international connectivity, he said HSBC Malaysia would continue to strengthen its capabilities across retail and corporate banking to drive further business growth.
On the key areas where banks would continue to play a major role, Omar said these include trade, investment and supply chains, digital, sustainability, wealth, Islamic finance and SMEs.
HSBC Malaysia recorded a commendable pre-tax profit of RM626mil for the first half of the year ended June 30, 2022, an increase of RM607mil compared with the corresponding period last year. Its pre-tax profit was RM19mil for the first half of last year.
For the period under review, total balance sheet size increased by 5.6% or RM5bil to RM94.6bil against RM89.6bil as at Dec 31, 2021.
HSBC Malaysia’s capital and liquidity coverage ratios continue to remain strong and well above regulatory requirements. As at June 30, 2022, the bank’s capital ratio stood at 18.3% versus 18.8% as at December last year.
On the issue of sustainability, Omar noted that last September, the government unveiled Malaysia’s goal to become carbon neutral as early as 2050.
“Globally, HSBC has committed, among others, to become a net-zero bank, support customers to transition to a low-carbon future, especially in carbon-challenged industries, and accelerate new climate solutions,” he said.
He added that banks also have a key role to play as a channel for working capital support for SMEs backed by 100% government guarantee.
“This will be critical to getting SMEs up and running again. HSBC Malaysia’s approach has been to help customers build financial resilience rather than financial reliance.
“This is helping customers recover more quickly and is key to building a sustainable future for the economy,” Omar said.
SMEs form the backbone of the Malaysian economy and currently account for 97.2% of total business establishments, generating 38.2% of gross domestic product and providing employment for 7.3 million people.