HSBC targets the rich in India
Bank aims to expand in the country to cater for fast-growing affluent class
Mumbai — HSBC aims to expand its personal banking services in India to serve the country’s fast-growing pool of high-earning professionals, after the launch there in July of its private bank.
In addition to wealth management services offered by the new private bank, the business will provide digital credit cards and personal loans to well-off customers, Hitendra Dave said in an interview with Reuters on Thursday.
The bank has long had a retail, or personal, banking business in India, but did not focus on building it up, said Dave.
“What has changed in the last three years is that the target market for HSBC in India has exploded,” he said. “We intend to build a very large retail, or what we call a personal, banking business.”
HSBC’s new private banking business in India, part of a wider focus on Asian wealth management, targets rich customers, typically defined as those with a net worth of more than $30m.
Beyond the most affluent, HSBC will target a rising number of Indian professionals, whose earnings and spending capacity rose significantly over the past few years, said Dave.
For this segment, HSBC will launch a “digital card issuance program” and a digital loan product “fairly soon”, in addition to its mortgage loans.
The number of high net worth individuals — those with an asset value above $1m — is seen more than doubling from 2022 to 1.65-million by 2027.
The retail banking push will mean more investment in technology and expansion of the bank’s branch network, said Dave. “We intend to build a profitable business,” he said.
HSBC India reported a profit before tax of $766m in the six months to June 30 2023, up from $645m in the matching period a year ago.
Global banking markets and commercial banking are the largest contributors to the business in India.
HSBC India’s wealth and personal banking segment, which includes private banking, mortgages and asset management, contributed $35m or 4.6% to its profit before tax in the first six months of 2023.
On the institutional side HSBC will grow investment banking, including through senior hires in trying to increase cross-border fundraising and merger activity as global interest in the Indian economy rises, said Dave.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.