Sir John's Dilemma: How to Put the Global in HSBC

摘要

Why, after more than two decades of overseas expansion, does it still generate more than 40% of its earnings in Hong Kong, a territory of just 424 square miles? It is a question that clearly annoys Sir John Bond, the silver-haired chairman of HSBC. "There are nearly seven million talented people there, with a high standard of living, low taxes and pretty effective government," he says during an interview in his spacious, modestly furnished London office. "Why on earth would you not want to expand your business" there? Still, HSBC's continued heavy reliance on Hong Kong worries some analysts and investors, who expect weak economic con ditions in Hong Kong to hold down bank ing profits there for the foreseeable future. While a U.S. recovery this year would probably spur the city's economy to resume expansion after zero real growth in gross domestic product in 2001, it may do little to stem price deflation, a problem for many banks.