HONG KONG (Reuters) – HSBC Holdings PLC plans to bring more than 1,000 jobs this year, during the development of the technology centers in China, such as the Asia-focused lender aims to strengthen its presence in the world’s second largest economy.
FILE PHOTO: The HSBC headquarters building is seen in the business district of Pudong in Shanghai, China, December 8, 2010. REUTERS/Carlos Barria/File Photo
Europe’s largest bank by assets, will boost headcount in the technology centers in Guangzhou, Shanghai and Xi’an by 14% from the current 7,000 employees, HSBC said Chief Information Officer Darryl West.
In the past few years is the London-based bank has spent $3 billion per year on the group’s technology operations in which use is made of 40,000 people worldwide, and the West said annual investments of $3-$3.5 billion are planned for the coming years.
Many global banks set up low-cost hubs in China and India more than a decade ago to maintain their complex and global information technology networks, but these centers have now become an important part of their activities.
The centres develop and implement risk and fraud management technologies, as well as digital applications that make it easier for banks to attract customers, faster and more secure services.
HSBC’s expansion plan in China, an important market for the bank, comes amid the increasing use of technology in the financial sector – payments to transactions.
At stake is a larger share of the billions of dollars of retail and corporate banking activities in a major financial market with a growing customer base.
“There is a lot more that we can do with the technology in the mainland of China. The level of technologies and innovation in China is far ahead of other markets,” West told reporters during a tour of HSBC’s technology center in the southern city of Guangzhou over the last week.
“We are seeing mainland China as a huge source of talent, not only for the local market, but our technology operations worldwide. We rent very aggressive here,” he added.
Approximately 30% of the work on the Guangzhou center, the largest HSBC-tech facility in China with more than 5,000 employees, is for the mainland of the market and that share is expected to grow in the next few years.
HSBC is also the use of the China-based tech centers to develop banking products for its global network, such as the bank, united kingdom mobile application that was developed in the northwest of the city of Xi’an.
Outside of China, HSBC employs more than 10,000 people at technology centres in India, with the rest in countries such as great Britain, Canada, Hong Kong and the United States.
HSBC has in recent years raised investment in China, including the prosperous southern Pearl River Delta region. The mainland of China and Hong Kong together accounted for almost 40% of the bank sales in 2018.
The bank invests $15-$17 billion in the next three years in areas including technology and China, Chief Executive John Flint said last year.
The limited physical presence of foreign banks in China compared with the dominant domestic rivals, is a challenge.
HSBC losses in the retail banking and wealth management (RBWM) in the mainland of China widened to $200 million last year from $44 million in 2017. The bank aims to reverse that with its investments in technology.
“Those things, which we see as very important for the next phase of our growth as the main investments have gone, RBWM will grow bigger and also become profitable,” said HSBC China Chief Executive Helen Wong.
Reporting by Sumeet Chatterjee; editing by Darren Schuettler