Is HSBC leaving the Philippines?

MANILA, Philippines [UPDATED] – The local unit of multinational bank HSBC denied it is pulling out its business in the Philippines and called the Financial Times report on the bank’s supposed plans to scale back Asian operations as “speculative.”

On Monday, March 12 (Tuesday in Manila), FT published a piece based on an interview with Peter Wong, the chief executive of HSBC in Asia, that the bank is closing its operations in the following 6 markets: 

• Bangladesh
• Brunei Darussalam
• Macau
• New Zealand
• Pakistan
• the Philippines
• Sri Lanka

It cited as reason the fact that HSBC has a small presence in these markets. Earlier, FT also reported that, under HSBC chief executive Stuart Gulliver, the bank is refocusing on markets “where it has a significant presence and businesses where it can make the most money.”

The FT report, quoting Wong, said the bank will “just focus on 6 core Asian markets outside of Hong Kong, which are those producing the fastest profits growth, and 2 strategic markets that will be important for the future.”

The 6 core markets are:

• Australia
• China
• India
• Indonesia
• Malaysia
• Singapore

It will also reportedly put more efforts on the following markets which it considers as “strategic”:

• Taiwan
• Vietnam

Wong reportedly referred to Taiwan as “the third leg of the Greater China story” and chose Vietnam because “it was very fast growing.”

“In the past, the way HSBC looked at Asia was Hong Kong and then the rest of Asia Pacific,” said Mr Wong. “But the rest of Asia Pacific was quite a few countries, so what we did was establish 6 key markets outside of Hong Kong that we wanted to focus our resources on.”

HSBC Philippines’ response

In a statement on Tuesday, March 13, Johanna Garcia, the local unit’s spokesperson, flatly denied the FT report, calling it “speculative.”

“The writer’s conclusions are completely speculative and not based on any new information or developments. We would like to reiterate that we are not exiting any markets in Asia. Our strategy in the region is to have strong, balanced and diversified geographies and businesses,” she wrote.

“The 6 priority and 2 strategic markets that were mentioned are where we prioritize our investment but that does not mean that we exclude other markets,” she stressed.

“We continue to review all our businesses to improve the way we allocate capital to markets and businesses with clear growth potential as stated by HSBC CEO Stuart Gulliver during Strategy Day last May 2011. We also continue to invest and grow in Asia as evidenced by our strong financial performance in 2011.”

Recently, HSBC’s London-based research group ranked the Philippines as the 16th largest economy in the world by 2050, citing robust economic growth rates and population size. – Rappler.com