Capitalizing for the Future: HSBC in 2010
Following the financial crisis of 2007/2008, HSBC CEO Michael Geoghegan saw a fundamental change in global opportunities and risks. With increasing regulation and fierce competition between banks, the Western hemisphere was going to be a tougher place to do business. Emerging markets, however, offered many opportunities. Geoghegan reasoned that in HSBC's case, a turn to emerging markets would be a return to its roots and to managing risks that it knew. But HSBC needed to understand what the implications of the new startegy -"moving to emerging markets" - were for its portfolio and overall risk profile. Especially, how should HSBC reallocate capital freeing up in the West across its diverse geographies and business lines?