HSBC GAM focuses on a two-stream European business
Even a big global player such as HSBC will struggle to be all things to all clients, so its Global Asset Management business is focusing on two areas.
Even global businesses cannot offer everything, everywhere to everyone. After a strategic review, HSBC Global Asset Management is focusing its European business on just two core areas: passive funds and emerging markets high-alpha products, including the emerging debt capability.
Andy Clark (pictured) became head of HSBC GAM’s Europe, Middle East and Africa wholesale business last year, as the asset management division recorded strong gains in market share worldwide. It has also taken some months to review what EMEA clients are seeking at a time of low growth, volatile markets and poor returns.
His conclusion is: “All our research into expectations and perceptions reinforces the message that clients want more information, and more leadership.”
Part of that is simply operational: finding ways to streamline information and get it out in a timely, accessible way, via online and mobile tools.
Clark says: “But increasingly, they want more than a fund factsheet. They want an informed view. There is a mixture of horror and worry at the unfolding scenario in Europe. Clients want product providers to be at the table, to do more for them in times like this.
“We do have a view, and there has perhaps been a perception that we didn’t. For example, we run the biggest India fund in the world. People want to know what we think of India and how to address that market.”
In Europe, the asset management business has offices in Geneva, Zurich, Stockholm, Madrid, Milan, Dusseldorf, Paris, Athens, Istanbul, Malta and Poland. Eastern and Central Europe is covered from Germany, while Italy is the base for southern Europe. Madrid also covers Portugal.
All offices have been open for more than ten years. HSBC GAM’s global and pan-European fund range is run out of Luxembourg, but Clark finds increasing differentiation among various national markets, where funds are used domestically.
The focus on core high-alpha emerging markets and exchange-traded funds (ETFs) is the result of a harsh, and growing trend: “The ‘bulk alpha’ in the middle is shrinking and people are deciding one way or the other. We already see that happening.”
Clark adds that the European wholesale intermediaries and advisers that form HSBC GAM’s client base are familiar with the brand, especially which is strongly associated with Asia and emerging markets.
“But they want us to step out from behind the broader name to offer leadership in, and about, the other markets we are in,” he says.
How are these demands being met? “It is about more contact, a greater visible presence. We have strengthened product specialist teams: numbers have gone from ten to 20. They speak to clients across Europe in local languages. We are organising more roadshows, and offering clients direct access to senior management.”