Anonymous Letter:
Global Banking & Markets: Rewards for Persistent Failure
We are entirely fed up and demoralized, and have no confidence at all in the existing leadership... Robin Phillips and the existing management team should be immediately shown the door and their bonuses should be clawed back because they have been paid under totally false pretenses... Phillips and his coterie should be replaced by the world-class investment banking professionals which HSBC deserves. - Letter from unnamed, senior HSBC bankers
This letter was sent to HSBC chief executive John Flint, chairman Mark Tucker and the board on August 25, voicing their concerns and what they call their “embarrassment” at how their division is being run.
Do you guys think the whistleblowing performed by the "unnamed bankers" is disrespectful to their organization or is rather an act of justice? Would you ever whistleblow if you felt it was necessary or would you rather switch organizations?
fnlondon released an article explaining the event
I can't believe this isn't getting more press. It's one thing for shareholders to make demands like this, but never heard of employees doing it publicly; it is fair to assume that it was leaked by the authors.
For how big the firm is, was always surprised to see how poorly hsbc did on league tables even if the focus wasn’t in IB.
Don’t see much changing though
Doesn't HSBC literally launder money for terrorists, and drug-kingpins?
deal flow from Chapo Guzman has been off. and the Daniel Ortega/Nicolas Maduro LBO was unfortunately a dog & pony show, CS has the deal all along
Full text of the letter came out today. Wow...
I just tried finding it (Yahoo, fnlondon, etc.) and couldn't locate the full text. Could you link it?
https://uk.finance.yahoo.com/news/group-hsbc-investment-bankers-call-bo…
“Based on one metric, we ranked 42nd in M&A: the accounting firms rank well ahead of us. We utterly lack credibility as an investment bank. Our revenues per professional would shame a regional solicitors firm, let alone an investment bank.” - It's not like HSBC was an investment banking powerhouse? HSBC has never focused on investment banking - that's just not their strength. And imo, it's fine, not all banks should strive to have strong investment banking divisions.
Of course not all banks should strive to be "strong" in investment banking, but they should strive to be strong in it, or strong in some aspect of it, if they're going to be in it at all. Chances are the entire division is a drag on the overall HSBC group's ROE, which of course hurts shareholders.
Not to mention it is damaging to credibility and ability to retain relationships - you don’t need to be #1, but you need to at least be somewhat commensurate with the scale and reputation of your institution.
I used to work there in their M&A team and people have felt this way for a long time. I’m glad that people are speaking up because rightly, nothing in the organization gets escalated properly.
The M&A, ECM and DCM departments are abysmal at best and when you overlay the corporate bank and redundant internal compliance staff, it’s massive drag to do anything. Put it this way, the name is so bad and getting worse that if you’re the CEO of a multinational, how can you possibly go to your board and tell them you’ve hired HSBC without losing some credibility? They’ll force you to hire someone else or add an additional bank.
Unfortunately this letter will change nothing. League table rank has slipped, we used to be top 20 and not even in the top 40 which is jaw dropping. You can have a few random hires here and there but the division needs a change in culture and frankly more talented people that actually has real relationships. There needs to be a full cleaning of the house at the top; Westerman already did a good job at firing non-performing Ds and MDs.
Agree on M&A and ECM
Disagree on DCM - HSBC is a monster in flow business for DCM and ultimately, that's what counts for DCM
I see them on both public and private debt deals all the time at work, but more anecdotal than anything.
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