UK investment bank HSBC plans to shift its business focus to Asia after reporting significant revenue declines in its 2020 annual results.
The bank announced it would invest $ 6 billion in Asia while focusing on wealth management and commercial banking to achieve “double-digit pre-tax growth in the region.”
HSBC’s decision to shift its focus to Asia follows 2020 full-year results, which saw pre-tax profit fall 34% to $ 8.8 billion from $ 13.35 billion last year, largely due to COVID -19 pandemic.
“The COVID-19 pandemic has severely affected our customers, our colleagues, our shareholders and the communities we serve,” said Mark E Tucker, group chairman, HSBC. “The first priority has been and is addressing the public health crisis, but the simultaneous economic crisis has also been unprecedented lately.”
The bank also reported a 10% decrease in reported revenue to $ 50.4 billion, attributed to lower interest rates around the world.
HSBC plans to counter the losses with an increased focus on the strongest business areas.
The bank already generates a large part of its income in Asia, but also confirmed in its results for 2020 that Asia in particular has shown signs of economic improvement in recent months.
“The most impressive economic recovery has been in China – still the greatest engine of global growth – where international trade is recovering the most,” added Tucker.
HSBC confirmed last February that it would be scaling back its investment banking activities in Europe and the US over the next three years, cutting 35,000 jobs in the process.
The bank reiterated in its 2020 full-year results that it continues to seek $ 4.5 billion in restructuring savings, with total adjusted costs reduced to $ 31 billion by next year and more than 100 eliminated Billions of dollars in risk with low-return-weighted assets.