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With smoke an mirrors the magic trick of HSBC and global profits seems real. Despite warnings that the momentum of growth in emerging markets is slowing down, Michael Geoghegan, CEO of HSBC Worldwide, is still betting on India as a high growth story. We need to know Geoghegan’s position on exportation of the “Household Model” which was a total failure and disaster in the United States. Until the implosion and global infection from subprime took a disasterous turn, we heard HSBC brag about “exportation of the Household Model to developing nations.” What does HSBC have in mind for India? we do not hear about the “Household Model” any more, and for good reason.
Just before taking off on his annual 68,000-mile pilgrimage to meet up with employees worldwide, Mr Geoghegan said that the current credit crisis is likely to leave Asia largely untouched. That is, until HSBC exports the “Household Model.” They will get a few good profitable years out of it before things fall apart. History shows that a predatory lender is a predatory lender regardless of geography. Emerging markets contributed to about 78% of HSBC’s first-half profits this year, given the losses in North America.
The question is whether HSBC will act professionally in accordance with their world wide banking heritage, or will HSBC see the quick profit via the predatory lending model. It will be Michael Geoghegan’s decision. Will he be a banker, a finance company thinker, or a predator? Time will tell.
This article, HSBC’s Geoghegan’s position on exportation of the “Household Model”, is just one of our articles from our Bank Horror Stories, HSBC Secrets Part 3
Bank Horror Stories monitors banking problems and customer complaints and has done so since 1999. Writers hold no stock positions. Some material is used under the fair use copyright act.
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