Awards for Excellence 2018
|
|
This award goes to HSBC for its transformation of HSBC Mexico. As Euromoney has reported a number of times in recent years, the weak performance of the bank – coupled with the wider strategic retreat of the bank from some Latin American retail markets – had led to expectations that it would be sold.
Instead, the bank changed its management, its strategy and its fortunes. Juan Parma, head of retail banking and wealth management for Latin America, was relocated from São Paulo after being closely involved in the sale of that country’s business to Bradesco.
|
|
|
Nuno Matos |
Parma says the key difference in making HSBC Mexico a viable business, as opposed to that in Brazil, was that the bank already had decent scale. But much needed to be done.
He also says that, while the turnaround was crystallized in last year’s results, the key change came with the appointment of Nuno Matos as chief executive at the end of 2015.
The bank invested in leveraging its global network to bring in better products and services to Mexican customers – in many cases HSBC Mexico became either the test environment for new technologies or innovated locally in adoption.
One of the most effective strategies was Fusion, which blends corporate and individual needs for small business owners. It is a product that Parma says has had a powerful impact on improving retention and loyalty – the bank registered the best score in the market in a third-party survey of customer satisfaction.
The bank also introduced new debt and credit card products, updating its market offering, and secured effective partnerships with third parties such as Uber. It is still relatively early days, but the results show the hardest part of any transformation – getting the ship to change course – has been achieved. The bank’s revenues increased by 11%, deposits by 24% and pre-tax profit leapt by 61% (helped by a reduction in costs and loan impairment charges).
The bank’s management is happy to concede that there is still a long way to go in the bank’s strategic plan – it is still only the fifth largest bank by assets. But at least HSBC has stopped losing ground and has begun heading in the right direction.
