Page 26 - HSBC (D) Case Study

This raised new questions about HSBC's conduct and
whether big banks like HSBC had become too big to

manage and moreover, who should be accountable when
things went wrong. (16)

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.