HSBC plans to grow big in China via IPO, outlets
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HSBC Holdings is preparing to boost its China presence by about 20 percent next year, as it ramps up for an IPO in one of its fastest growing markets, a top company executive said.
Europe's biggest bank aims to open 15-20 new branches in China next year pending regulatory approval, up from the 90-100 it will have at the end of this year, Sandy Flockhart, chief executive of Hong Kong and Shanghai Banking Corp, said in Taipei yesterday.
"We will be the largest international bank in China," Flockhart said, following the bank's first board meeting in Taipei. "We will continue to invest in China in 2010."
Flockhart said his bank, which posted a 50 percent drop in first half profit, will focus its Asia acquisition strategy on China and other emerging markets as it increasingly relies on the region for growth.
To underscore the importance of China to its future, HSBC has become one of a handful of foreign companies to announce its intent to list in China when the country announces rules for such listings as soon as late this year or in early 2010.
Hong Kong's Bank of East Asia has said it would like to make such a listing, and media have reported Standard Chartered, which also has a heavy China presence, is also interested in such a listing.
HSBC's planned China initial public offering is dependent on regulatory requirements, and there is no specific time frame yet, Flockhart said.
HSBC could raise as much as 50 billion yuan (US$7.3 billion) in a Shanghai listing as soon as next year as it vies to become one of the first foreign firms to list in China, people familiar with the matter told Reuters in August.
The bank has hired China International Capital Corp and CITIC Securities Co to help arrange an IPO in Shanghai, a person with direct knowledge of the situation told Reuters.
The Shanghai flotation is a way to accelerate the bank's growth on the mainland at a time when international rivals have retreated, it has said.
HSBC has been among the most active foreign banks in China, where it earned a pre-tax profit of US$752 million in the first half of the year.
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