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HSBC Case Study

The bank’s name is found to be derived from the initials of the expanded for which are The Hongkong and Shanghai Banking Corporation Limited. It is the founding member of HSBC. It was established with one simple aim or idea of a local bank which can be found to serve the international needs of the population. In the year 1865, HSBC was fully opened to the business platform in Hong Kong so as to help the financing part of the trade to occur between Europe and Asia. It has been 15 years of this bank and is consistently serving their customers which include the funding of 40 million personal interests, wealth as well as corporate customers all around the globe within 64 countries together with the territories. It is one of the leading banking in the financial as well as banking service sectors.

SWOT ANALYSIS

HSBC by participating in the global platform is found to be aligned with many opportunities which help it to expand its shares in the market. All the favorable factors said and done, the bank is required to consider the situation such as recessions, credit crises as well as volatility. Therefore there is a need to reconsider the bank’s strategies by looking up to it strengths as well as weaknesses together with the potential opportunities as well as the threats in the market place.

Strength

  • The bank is a very well established in terms of capitals which can account for its withstanding capacity of the volatility together with the credit crises which has been developed because of the competition in the financing world.
  • Stable capitalism also accounts for the fact that the company will not have to be dependent on the assistances provided by the government in the time of crises.
  • It can be said that he bank has established itself in the market area with all the competition and has a strong position.
  • It has a very diverse platform with respect to the portfolios of the financial products as well as location which can help them to take more risk in comparison to the other banks.
  • It has been working on many cost-cutting measures so as to help with the bank’s operations more effluent in terms of efficiency and add up to its profit in the long run.

Weaknesses

  • HSBC, with its association with the small business has been contributing towards its increase in the vulnerability to greater risks which can lead to the short falls in the profit area.
  • It was found that the bank was integrated with the sub-prime platforms or markets in the United States and also had a taste of scandal in the year 2012 which contributed towards the damage of the bank’s reputation to some extent which has not been recovered yet. In recent times it was also reported that the bank is under investigation with the possible matter of the foreign exchange market with concern on manipulation. This again hampered the bank’s reputation.
  • The announcement of the layoffs for the strategy of the cost-cutting measures has found to be accumulating negative opinion about the bank as well its years of talent together with their base of stakeholders.
  • As it has become a brand in the global platform it has been found that it has lost all the connections with the local audience because of the homogenized image which does not foster the needs of the local population.

Opportunities

  • Stable capitalism of the bank helps it to acquire different additional assets so as to furnishing the strengths of the bank and maintain it model.
  • It has the opportunity to acquire market shares as well as hold in the new emerging markets with the help of acquisition which includes bank Ekonomi in Indonesia and many other similar types of bank.
  • Its growth on the global platform can help the bank to minimize the shocks of the financial as well as the credit crises. This makes the bank a safe place to invest.
  • The press coverage of the bank is also very efficient which works by overshadowing the wrong steps taken by the bank which lead it to the opportunity of cleaning up his image and taking the scandals off the mind of its customers.

Threats

  • Financial losses, unethical behavior and credit issues lead to the negative picture of the bank in front of their customers.
  • The profitability is under investigation with respect to the defaults of the housing industry because of the reduction in the home values as well as rising interest patterns.
  • Company is required to improvise the reporting mechanism as well as provide with more of the evidence with respect to the lending, investment as well as practices.

PESTLE ANALYSIS

Pestle analysis gives a scope to understand the macro environment which influences the business and those include political, economic, social, technological, environmental and legal factors.

Political

  • The measures of the government budgets which include both local as well as national ones.
  • Unrest in the country together with the scope of civil unrest.
  • A great number of treaties.
  • Judiciary independence factors with respect to the commercial as well as business decisions.
  • The threats concerned with the terrorists attacks.

Economic

  • The increase in the disposable income on the consumer level.
  • Fluctuations of the price in the local as well as the international markets.
  • The increase in the work force and the productivity.
  • Fiscal as well as the monetary policies.
  • Spending for the government.
  • The demand for the shift of the goods economy to altogether service economy.

Social

  • Immigration policies as well as the level of the process of the immigration.
  • Demographic trend.
  • Attitude of the authorities.
  • Level of the concerns with respect to the social awareness of the bank and its policies.
  • The nature or the pattern of the social contract amongst the government and the society.

Technological

  • Property rights as well as the patents protection
  • Cost of the production as well as the trends.
  • Empowerment of the supply partners of the bank’s chain.
  • The chances for the technological disruption.
  • Mobile payments.
  • Research and developments of the banks with respect to the technological demands.
  • The acceptance level of the technology and its involvement in the society.

Environment

  • Management of the wastes
  • The policies for the process of the recycle.
  • The influence of the climate change.
  • The carbon emission management.
  • Consumer engagement.

Legal

  • The laws for the securities.
  • The independent factors with respect to the Judiciary as well as the relative influence of the respective governments.
  • Laws for not only security but also the health and safety.
  • The time for the court sessions in the timely manner.
  • The laws for the business.
  • The consumer of the customer protection laws to be implemented properly and stringently.

From the above two analysis it can be said that HSBC bank, be it stable in capitalism is not except without weaknesses and flaws together with the scandals. Effective management strategies help the bank to clean its image in front of its consumers.

 

BIBLIOGRAPHY

Cardenas, M.L., Ameglio, T., Saudreau, M., Ngao, J., Parramon-Dhawan, D. and Loiselle, S., 2019, June. Higher sustainability thanks to better afforestation of Cities (HSBC). In TNOC 2019 (pp. 1-p).

Girod, S.J. and Karim, S., 2017. RECONFIGURE?. Harvard Business Review.

Jones, G.G. and Comunale, R., 2018. Oral history and writing the business history of emerging markets. Harvard Business School General Management Unit Working Paper, (19-056).

Jun, F., 2018. Study of Relationship Between Credit Risk (Non-Performing Finance Ratio) and Internal and External Factors in HSBC Bank. Available at SSRN 3301111.

Naheem, M.A., 2016. Risk of money laundering in the US: HSBC case studyJournal of Money Laundering Control.

Naheem, M.A., 2018. Illicit financial flows: HSBC case study. Journal of Money Laundering Control.

Rosdiana, R., 2019. Comparative Analysis of Pt Bank HSBC Indonesia Financial Performance between 2017 and 2018.

Tolliver, C., Keeley, A.R. and Managi, S., 2020. Policy targets behind green bonds for renewable energy: Do climate commitments matter?. Technological Forecasting and Social Change157, p.120051.

Trudeau, C. and McLarney, C., 2017. How Can Banks Enhance International Connectivity with Business Customers?: A Study of HSBC. IUP Journal of Business Strategy14(2).

Tsolakis, V., 2016. Leadership in Banking. Modul Vienna University.

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