In 1865, HSBC was originally founded as the Hongkong and Shanghai Banking Corporation (HSBC). Currently, HSBC Holdings is a multinational service and banking corporation headquartered in London with over 6,600 locations worldwide. It is the world’s third largest bank in terms of assets.
As a student studying abroad in China it was amazing to gain an inside look at the banking industry in a foreign country, especially in a city that has some history for this particular financial institution, HSBC. Ironically, before traveling abroad I had heard of this bank because I used to have a high interest savings account with them. However, as I learned they are not in the business of servicing individuals but more focused on businesses and foreign investing. Particularly, it was interesting to learn that the biggest value HSBC offers for its clients is its international services.
Historically, HSBC has roots in Shanghai, however in 1955 they gave up their offices to the communist Chinese government while continuing operations through a lease agreement. The current Shanghai branch we had the opportunity to tour was established in 2007 as one of the first foreign banks to become fully incorporated in China. As a nation, China limited foreigner’s opportunities in the past, however, it has slowly relaxed certain regulations to allow foreign businesses to flourish. Nonetheless it is still difficult to gain market share, however, HSBC has become the largest foreign bank in China.
During the presentation, I found the Q&A with the director to be interesting since he was an American working abroad. After traveling abroad on this trip, I’ve considered working abroad, especially as an Accounting major. There are so many opportunities for advancement for those who take positions outside of the United States because there’s so much to learn. Additionally it was fascinating to learn about the various services HSBC offers. It amazes me how strict the Chinese government regulates the banking industry. It comes as no surprise since these banks are operating in a communistic environment, nonetheless it seems that these regulations seek to limit foreign investment and incentives to conduct business within the country. The fact that businesses need four different bank accounts to save, receive, and pay cash domestically and abroad makes managing any business more complicated.
Through close observation of the business environment in China, it seems as if, as a nation, they are becoming increasingly free market based rather than communistic. I believe in the future, China will become more relaxed in its banking regulations, further allowing more foreign investment and businesses operating in China. This is the only way they can sustain their growth and achieve their goal of becoming a world power like the United States and others.