Banking giant HSBC expects its commercial banking business in the Asia-Pacific region to expand further next year, albeit at a slower pace, driven by intraregional trade, group general manager Noel Quinn said in Taipei yesterday.
Quinn, head of commercial banking in Asia-Pacific, which serves 18 markets, said the segment may see continued growth next year even though the pace may decline as the sluggish economies of the US and Europe will have a negative impact on Asia.
The increasing volume in intraregional trade will help mitigate the impact now that it accounts for about 50 percent of all trade in Asia, Quinn said.
Commercial banking pre-tax profit in Asia increased 33 percent year-on-year in the third quarter, Quinn said.
For the first nine months, Asia contributed 47 percent to HSBC global commercial banking’s pre-tax earnings, which gained 30 percent last year, thanks to growing deposits, loans and fees income, Quinn said.
“Emerging market trade will continue to boost global economic recovery,” he said. “By 2050, 19 of the top 30 markets [measured by GDP] will be countries currently described as emerging economies.”
While upbeat about business under his marshal, Quinn said the economic outlook for next year is unpredictable.
“The landscape three to six months down the road is a big unknown,” he said. “We see signs of decline in trade finance due to a slowdown in business activity.”
This and other unfavorable developments will not lead to a repeat of the financial crisis in late 2008 and 2009, Quinn said.
HSBC said earlier this year it aimed to shed 30,000 jobs worldwide in the next two years, but added that it intended to increase headcounts in China and make adjustments in Hong Kong.
“We will continue with expansion in Greater China and see Taiwan as an important part,” Quinn said.
HSBC will further seek to take advantage of the Chinese currency’s growing importance in trade and trade finances, strengthening its yuan-denominated deposits and investment product lines, Quinn said.
Increased emerging-market trade will help accelerate the yuan to become a reserve currency, which would be the world’s third largest turnover currency if it was fully convertible, Quinn said.
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