One could reasonably contend that FX is the DNA of HSBC. Indeed, the history of HSBC is based on trade finance – its significant competitive advantage reinforced by a vast APAC presence and a team of 168 specialists focussed on trading and structuring, and manifest in its bespoke products, competitive pricing and liquidity. It seems fitting, therefore, that HSBC has been recognised by its private banking clients as the Best Provider of FX Structured Products for 2012.However, Selene Chong is quick to point out that HSBC’s success in this space is more than a corollary of legacy and reach. Rather, Chong looks to the increasing attractiveness of FX structured products to private banking clients. This is especially true in Asia, where clients seek to diversify away from the Dollar to more attractive Asian currencies; and, as private banks tend to focus on liquidity and market access/information when choosing a provider, it is here, according to Chong, where HSBC’s strengths shine through.
“Clients want to make sure that they can easily exit [from structured product investments],” explains Hossein Zaimi, who further emphasises the bank’s large client base which enables it to distribute costs and offer structured products for a very competitive fee. “HSBC is unique in this aspect because we don’t need to rely on the interbank market for liquidity,” he adds. “We hold 50% market share in custody flows through our security services business, and so even when there is no liquidity in the market, we have liquidity through our securities business.”
In order to understand a client’s specific needs and, ultimately, to tailor the right solutions, Chong and her team start engaging with the client at a very early stage. Here, it is the strength of Chong’s team and its direct focus on the client which typify HSBC’s approach. “Very often we have multiple touch points with private banking clients,” Chong concludes, showing that HSBC’s success in providing FX structured products is as much about synergy with the client at a personal level as it is about sheer clout at an institutional level. “Protecting our clients means protecting our own interest in the client.”
Evidently, this point has not escaped those private banks consulted in the Asian Private Banker Structured Products Survey and Poll, with HSBC justifiably emerging as the Best Provider of FX Structured Products for 2012.