HSBC Holdings PLC (HSBC Holdings), incorporated on January 1, 1959, is a United Kingdom-based banking and financial services organization. Its international network comprises over 10,000 properties in 83 countries and territories in Europe; Hong Kong; rest of Asia-Pacific, including the Middle East and Africa; North America and Latin America. HSBC Holdings together with its subsidiaries (HSBC) provides a range of financial services to more than 128 million customers. HSBC manages its business through two customer Groups: Personal Financial Services and Commercial Banking, and two global businesses: Global Banking and Markets, and Private Banking. Personal Financial Services incorporates the Company’s consumer finance businesses. The largest of these is HSBC Finance Corporation (HSBC Finance), a consumer finance company in the United States.
As of April 23, 2008, HSBC Holdings held a 73.56% interest in Sing Lun Holdings Ltd. On March 26, 2007, the Company, through its subsidiary, HSBC France, acquired the 50.01% of Erisa S.A. and Erisa I.A.R.D. (together re-named HSBC Assurances) shares not already owned, raising the total holding in each entity to 100%. HSBC Assurances is a group of companies offering life, property and casualty insurance products through HSBC France’s networks. During the year ended December 31, 2007, the Company disposed of part of its non-core credit card portfolio, principally the Marbles brand.
Personal Financial Services
Personal Financial Services provides over 125 million individual and self-employed customers with financial services in 57 countries. Typically, products provided include personal banking products (current and savings accounts, mortgages and personal loans, credit cards, and local and international payment services), together with consumer finance and wealth management services. HSBC Premier is a comprehensive banking and wealth management service for mass affluent, internationally orientated customers. This premium banking service provides personalized relationship management, 24-hour priority telephone access, global travel assistance and wealth management services. There are over 2.1 million HSBC Premier customers, who can use more than 280 specially designated Premier branches and centers in 37 countries and territories, either temporarily when visiting or on a more permanent basis if they require a banking relationship in more than one country.
In certain selected markets, HSBC Direct provides products specifically tailored for the online market. Insurance products distributed by HSBC through its direct channels and branch networks include loan protection, life, property and health insurance and pensions. HSBC also makes available a range of investment products. A choice of third party and its own funds is offered, including traditional long only equity and bond funds; structured funds that provide capital security and opportunities for an enhanced return, and fund of funds products. Comprehensive financial planning services covering customers’ investment, retirement, personal and asset protection needs are offered.
HSBC Finance’s operations in the United States, the United Kingdom and Canada make credit available to customers not well catered for by traditional banking operations, facilitate point-of-sale credit in support of retail purchases and support major affiliate credit card programs. HSBC Finance is a credit card issuer in the United States, offering HSBC, Household Bank and Orchard bank branded cards together with affiliation programs, such as the GM Card and the AFL-CIO Union Plus card. HSBC Finance is also a provider of third-party private label credit cards (or store cards) through 56 merchant relationships.
HSBC has 2.8 million Commercial Banking customers in 64 locations, including partnerships, clubs and associations, incorporated businesses and publicly quoted companies. At December 31, 2007, HSBC had total commercial customer account balances of $238 billion, and total commercial customer loans and advances, net of loan impairment allowances, of $220 billion. HSBC segments its Commercial Banking business into corporate, mid-market, small and micro businesses. The range of products and services includes financing, payments and cash management, international trade, treasury and capital markets, commercial cards, insurance, wealth management services and investment banking.
HSBC provides a range of short and longer-term financing options for Commercial Banking customers, both domestically and cross-border, including overdrafts, receivables finance, term loans and property finance. HSBC offers forms of asset finance in five sites and has established specialized divisions providing leasing and installment finance for vehicles, plant and equipment. HSBC is a provider of domestic and cross-border payments, collections, liquidity management and account services worldwide. HSBC’s network of offices and direct access to numerous local clearing systems, enables its customers to manage their cash on a global basis. HSBC finances and facilitates significant volumes of international trade, under both open account terms and traditional trade finance instruments. HSBC also provides international factoring, commodity and insured export finance, and forfeiting services. Commercial Banking customers are volume users of the HSBC Holdings’ foreign exchange capabilities, including sophisticated currency and interest rate options.
HSBC offers commercial card services in 39 countries. HSBC offers card acquiring services, either directly or as part of a joint venture, enabling merchants to accept credit card payments either in store or on the Internet. HSBC offers insurance services in 28 sites, which cover a range of commercial insurance products designed to meet the needs of businesses and their employees, including employee benefit, pension and healthcare programs. These products are provided by HSBC either as an intermediary (broker, agent or consultant) or as a supplier of in-house or third-party offerings. HSBC also provides insurance due diligence reviews, and actuarial and employee benefit consultancy services. Wealth management services include advice and products related to savings and investments provided to Commercial Banking customers and their employees through HSBC’s worldwide network, with clients being referred to Private Banking where appropriate. A small number of Commercial Banking customers need corporate finance and advisory support. These requirements are serviced by the HSBC Holdings on a client-specific basis. HSBC deploys a range of delivery channels, including specific online and direct banking offerings, such as HSBCnet and Business Internet Banking.
Global Banking and Markets
HSBC’s Global Banking and Markets business provides tailored financial solutions to major government, corporate and institutional clients worldwide. Global Banking and Markets is managed as four principal business lines: Global Markets, Global Banking, Principal Investments and HSBC Global Asset Management. Global Markets consist of treasury and capital markets services for supranationals, central banks, corporations, institutional and private investors, financial institutions and other market participants. Products include foreign exchange; currency, interest rate, bond, credit, equity and other specialized derivatives; government and non-government fixed income and money market instruments; precious metals and exchange traded futures; equity services; distribution of capital markets instruments, and securities services.
HSBC’s operations in Global Banking consist of financing, advisory and transaction services for corporations, institutional and private investors, financial institutions, and governments and their agencies. Products include financing and capital markets, international, regional and domestic payments and cash management services, and other transaction services, including trade services, factoring and banknotes. HSBC Global Asset Management offers asset management products and services for institutional investors, intermediaries and individual investors and their advisers. Other products include private equity, which comprises HSBC’s captive private equity funds, strategic relationships with third-party private equity managers and other investments.
HSBC Private Bank is the principal marketing name of the HSBC Group’s international private banking business, which together with HSBC Guyerzeller and HSBC Trinkaus & Burkhardt, provides the services, such as investment services, global wealth solutions, specialist advisory services and general banking services. Investment services comprise both advisory and discretionary investment services. A range of investment vehicles is covered, including bonds, equities, derivatives, options, futures, structured products, mutual funds and alternative products, such as hedge funds and fund of funds. Global wealth solutions comprise inheritance planning, trustee and other fiduciary services designed to protect existing wealth and create tailored structures to preserve wealth for future generations. Areas of service include trusts, foundation and company administration, charitable trusts and foundations, insurance and offshore structures.
Private Banking offers service in several specialist areas of wealth management, including tax advisory and financial planning, family office advisory, corporate finance, consolidated reporting, industry services, such as charities and foundations, media, shipping, diamond and jewelry, and real estate planning. General banking services comprise treasury and foreign exchange, offshore and onshore deposits, credit and specialized lending, tailor-made loans and Internet banking.