Page 160 - Bank Case Studies

Part of the problem for Gulliver was that HSBC generated

almost $8 in every $10 of its total pre-tax profits from Asia,

yet more than half its loan book and two-thirds of its capital

was still deployed in other regions, primarily Europe and

North America and here they were weighed down by low

rates.

Analysts demanded the bank split its business, as it was ‘too

big to manage’ with a bureaucracy by the level out of

control. HSBC executives acknowledge that the bank's sheer
size and rapid growth before the financial crisis led to

control issues but according to Gulliver, HSBC was still

manageable under its current structure. Moreover, the bank

planned to sell assets in Brazil, Turkey and the United States

which would help reduce hard-to-track positions in its

banking units in these countries. (16) Where the bank had

more than 6,100 offices in 73 countries.

Source: FT (18)