Could you describe the state of the deal with HSBC?
These are very early days, and there are a number of regulatory hurdles to jump. There is also a period of due diligence granted by Old Mutual, our majority shareholder, to HSBC. We will be working with HSBC directly to understand their strategies.
What are HSBC’s strategies in approaching Nedbank?
There are two key mega trends determining HSBC’s approach. First, emerging markets are growing faster than developed markets, so interest will grow in South Africa and the rest of Africa. South Africa is regarded as a gateway into Africa. This is particularly important, because about 80% to 90% of the profit coming from financial services in the whole of Africa either resides in South Africa or is accessible through South Africa. In short, if you want to have an Africa strategy, South Africa is 90% of the game.
The second piece of HSBC’s strategy is that global trade flows are growing faster than global GDP. That points to the linkages between Africa and Asia, from a commodity-exporting perspective. Asia is South Africa’s largest export partner. HSBC has very strong businesses in Asia. There is no doubt it would use this as a linkage with those.