HSBC in India HSBC's Origins in India Date Back to 1853, When The
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INTRODUCTION:- HSBC in India HSBC's origins in India date back to 1853, when the Mercantile Bank of India was established in Mumbai. The Bank has since, steadily grown in reach and service offerings, keeping pace with the evolving banking and financial needs of its customers. In India, the Bank offers a comprehensive suite of world-class products and services to its corporate and commercial banking clients as also to a fast growing personal banking customer base. Since our inception, we have entered new markets and launched innovative new products to help our clients seize investment opportunities around the world. Our origins The HSBC group was founded in Hong Kong in 1865 to finance trade between the China coast and Europe and the United States. Since then, the HSBC Group has expanded through both internal growth and acquisition. Members of the Group include HSBC Private Bank (UK) Limited (formerly Samuel Montagu & Co Limited), founded in 1853, HSBC Trinkaus & Burkhardt KG (1785), HSBC Guyerzeller Bank AG (1866), HSBC Bank USA (formerly Republic National Bank of New York) (1966) and Crédit Commercial de France (CCF, 1894). HSBC Private Bank (formerly HSBC (Republic) was established on 31 December 1999, when HSBC acquired Republic New York Corporation and Safra Republic Holdings, parent companies of Republic National Bank of New York. Founded in 1966 and built on a banking tradition established during the Ottoman Empire, Republic National Bank of New York specialized in private banking. Since then, our business has grown substantially, both organically and through acquisition. We are currently building a strong onshore business to complement our historical franchise. The marketing name HSBC Private Bank was adopted on 1 January 2004. The use of the label 'HSBC Private Bank' refers to HSBC's worldwide principal private banking business, and is not indicative of any legal entity or relationship. pg. 1 HSBC's History The HSBC Group has an international pedigree which is unique. Many of its principal companies opened for business over a century ago and they have a history rich in variety and achievement. Foundation and growth The HSBC Group is named after its founding member, The Honking and Shanghai Banking Corporation Limited, which was established in 1865 in Hong Kong and Shanghai to finance the growing trade between China and Europe. The inspiration behind the founding of the Bank was Thomas Sutherland, a Scot who was then working as the Hong Kong Superintendent of the Peninsular and Oriental Steam Navigation Company. He realized that there was considerable demand for local banking facilities both in Hong Kong and along the China coast and he helped to establish the Bank in March 1865. Then, as now, the Bank's headquarters were at 1 Queen's Road Central in Hong Kong and a branch was opened one month later in Shanghai. Throughout the late nineteenth and the early twentieth century‟s, the Bank established a network of agencies and branches based mainly in China and South East Asia but also with representation in the Indian sub-continent, Japan, Europe and North America. In many of its branches the Bank was the pioneer of modern banking practices. From the outset, trade finance was a strong feature of the Bank's business with bullion, exchange and merchant banking also playing an important part. Additionally, the Bank issued notes in many countries throughout the Far East. During the Second World War the Bank was forced to close many branches and its head office was temporarily moved to London. However, after the war the Bank played a key role in the reconstruction of the Hong Kong economy and began to further diversify the geographical spread of the Bank. The making of the modern HSBC Group The post-war political and economic changes in the world forced the Bank to analyse its strategy for continued growth in the 1950s. The Bank diversified both its business and its geographical spread through acquisitions and alliances. However, it remained committed to its historical markets and played an important part in the reconstruction of Hong Kong where pg. 2 its branch network continued to expand. In 1959 the bank completed two important purchases, those of The British Bank of the Middle East (now HSBC Bank Middle East) and the Mercantile Bank. The British Bank of the Middle East had begun life as the Imperial Bank of Persia in 1889 but throughout the 1940s and 1950s had extended its sphere of operations and pioneered banking in the Gulf States. The history of Mercantile Bank stretched back to 1853 - the year it was founded in Bombay (now Mumbai) - and by the 1950s it had a strong identity within Indian and other Asian markets. In 1965 the Bank purchased a controlling interest in Hang Seng Bank, which had been established in Hong Kong in 1933. By the 1970s the policy of expansion by acquisition of subsidiaries with their own identities and specializations was firmly in place. During the 1980s the Bank concentrated on moving into those markets where it was not yet fully represented. Hongkong Bank of Canada (now HSBC Bank Canada) was established in 1981 and Hongkong Bank of Australia (now HSBC Bank Australia Limited) in 1986. In 1987 Marine Midland Bank (now HSBC Bank USA), based in New York State, became a wholly owned member of the Group and its principal subsidiary in the United States. HSBC Holdings plc, the parent company of the HSBC Group, was established in 1991 with its shares quoted on both the London and Hong Kong stock exchanges. The acquisition in July 1992 of Midland Bank in the United Kingdom created one of the largest banking and financial services organizations in the world. Midland was founded in 1836 in Birmingham and had grown in the nineteenth and twentieth century‟s through a series of mergers and amalgamations. In 1974 Midland acquired the London merchant bank of Samuel Montagu, whose own distinguished history stretches back to 1853. Samuel Montagu has been integrated into HSBC Investment Bank, as has James Capel, a leading London-based international securities company, which was acquired by the Group in 1986. The 1990s have seen further expansion and consolidation of the various businesses of the HSBC Group. In the United States, a joint venture, the Wells Fargo HSBC Trade Bank was formed in 1995. Elsewhere in the Americas in 1997, a new subsidiary Banco HSBC Bamerindus was established in Brazil; the acquisition of the Roberts Group (now called HSBC Bank Argentina SA) in Argentina was completed, and a 19.9 per cent interest in Mexico's Group Financiero Serfin was purchased. In 1999, HSBC Holdings plc signed a pg. 3 memorandum of understanding with the Government of Korea for the acquisition of a controlling interest in Seoul Bank, one of the largest commercial banks in South Korea. The HSBC Group now comprises a unique range of banks and financial service providers around the globe. Establishment and early the inspiration behind the founding of the bank was Thomas Sutherland, a Scot who was then working for the Peninsular and Oriental Steam Navigation Company. He realized that there was considerable demand for local banking facilities in Hong Kong and on the China coast, and he helped to establish the bank which opened in Hong Kong in March 1865 and in Shanghai a month later. Soon after its formation, the bank began opening branches to expand the services it could offer customers. Although that network reached as far as Europe and North America, the emphasis was on building up representation in China and the rest of the Asia-Pacific region. HSBC was a pioneer of modern banking practices in a number of countries – for instance, in 1888 it was the first bank to be established in Thailand, where it printed the country's first banknotes. From the outset trade finance was a strong feature of the local and international business of the bank, an expertise that has been recognized throughout its history. Bullion, exchange, merchant banking and note issuing also played an important part. In 1874, the bank handled China's first public loan and thereafter issued most of China's public loans. By the end of the century, after a strong period of growth and success under the leadership of Thomas Jackson (chief manager for most of that period from 1876 to 1902), the bank was the foremost financial institution in Asia. Challenges and changes The 20th century saw challenges and change for HSBC. In the early years of the 20th century, HSBC widened the scope of its activities in the East. It became increasingly involved in the issuing of loans to national governments, especially in China, to finance modernization and internal infrastructure projects such as railway building. The First World War brought disruption and dislocation to many businesses, but the 1920s saw a return to prosperity in the East as new industries were developed and trade in commodities such as pg. 4 rubber and tin soared. The bank's new head office in Hong Kong (1935) and the new buildings at major branches such as Bangkok (1921), Manila (1922) and Shanghai (1923) reflected this confidence. The 1930s ushered in an era of uncertainty with economic recession and political turmoil in many of the bank's markets. In the Second World War, the majority of the bank's staff in the East became prisoners of war as the enemy advanced through Asia. The bank survived under the new leadership of Arthur Morse, and through its prudent policy of building up large reserves in peace time. At the end of the war, HSBC took on a key role in the reconstruction of the Hong Kong economy.