• Shifts focus away from low-return US and Europe markets
• Cost-cutting among top agendas
• Digital push weighs on hiring activity

Volatility in the markets brought on by the COVID-19 pandemic is forcing London-based HSBC Holdings Plc (HSBC) to shift focus away from the low-return US and Europe markets to Asia. Against this backdrop, mentions around Asia and related keywords grew by around 47% in HSBC’s earnings transcripts in 2020 compared to 2019, reveals GlobalData, a leading data and analytics company.

An analysis of GlobalData’s Company Filing Analytics Database reveals that HSBC’s earnings transcript sentiment score rose by around 20% in Q1 2021* driven by the positivity around digital banking, mobile payments and sustainability.

In addition, the online shift prompted the bank to focus on office space reduction. As a result, discussions around office space reduction and WFH arrangements grew by 4X in the same period.

Rinaldo Pereira, Senior Business Fundamentals Analyst at GlobalData, says: “Cost-cutting and capital conservation are among the top strategies for the bank in 2021. Discussions around the US rose by around 35% in 2020 as the financial services provider is considering the US retail banking market exit.”

According to GlobalData’s Financial Services Database, HSBC holds meagre shares of the US’ retail banking market. In its latest earnings transcript, HSBC acknowledged the lack of competitiveness and high returns in the US. As a result, the bank earmarked US$6bn to invest in its wealth management and wholesale banking operations across Asia over the next five years.

GlobalData’s Jobs Analytics Database identified that around 85% of HSBC’s active jobs (between September 2020 and March 2021**) were in the Asia-Pacific region. Furthermore, active jobs in Asia-Pacific have been on the uptrend since September 2020. Big data, cloud and cybersecurity were among the top job themes, with the UK-based lender fueling its digital initiative to gain from the digital banking and mobile payments boom.

Mr Pereira concludes: “The bank expects to reduce its manual workflow and re-skill the employees involved in digital processes. HSBC’s Asian drive also seems to be a step in the right direction as GlobalData expects retail banking to recover more in Asian economies in 2021 as compared to the US and Europe***.”

*Q4 2020 (ended December 2020) earnings transcript released on 23 February 2021

**Until 10 March 2021

***GlobalData’s Retail Banking Analytics Dashboard