Chillin' out till it needs to be funded
Here is this man who took over one of the better performing global banks from John Bond just six months ago and in the aftermath of the same questions would have statutorily arisen on the real ‘global’ spread of the bank, the rising costs and the need to get in step with the regulators and the policy making. Couldn’t Moynihan stop dithering and learn from him when the US mortgage market is not looking up either since 13 quarters ago when it started falling off the cliff? While waiting for the mortgages to pick up, Merrill lynch’s units performance may not be enough if the recession on the home sales front continues into 2012
Gulliver, Stuart in the meantime has planned cost reductions of up to $15 bln in the next 5 years as he is clarifying tonight at the Canary Wharf HQ, esp targeting the retail bank. Also the $25 bln sale planned in the US has turned out to be the Cards business and correspondingly it might be looking for purchases and expansion in Mexico and Brazil
Where are the savings for HSBC?
In a very interesting Beyond Brics update of the Gulliver’s Travails presentation HSBC redefines what is not working in some EMs but most of the cost cutting will be on home turf in the UK retail and France, Turkey and Germany. No wonder when most of the business lost has been in the europe geographies apart from the ever bleeding Credit cards portfolio in the US consumption economy.
And if the savings are happening in London, then retail’s underperformance means more space will be available at the Canary wharf HQ for others who can pay the rent to HSBC
More from the presentation..
The basis for strtaegy day from our most deserving candidate for the World Champion in Banking is however in that China, Iindia and other 17 EMs would be in the Top Income countries by 2050 and Incomes will grow by 7.4X and 6.3X times in China and India respectively. The mexican Dollar issued apparently in Shanghai during the last century is cute too and yes we do believe it shows global ethos Now that is not the reason why we are rooting for the sailor. We just think Moynihan had a head start to repair the place..