HSBC India over the next three to five years plans to expand its footprint in the private banking space to cover 14 cities from its current count of seven cities. ?To start with we have short listed six cities, namely Chandigarh, Ludhiana, Jaipur, Ahmedabad, Baroda, Cochin to expand our business. We will start rolling out our private banking business in a phased manner in these cities from end of this year?, said Ramnath Krishnan, managing director and head of HSBC Private Banking.
With the increasing number of high net worth individuals (HNIs) in India, HSBC expects the private banking business to flourish here. Private banking business of HSBC, in revenue terms has seen a substantial growth of more than 50% in 2008, over 2007. 2009 though is unlikely to see similar growth, given the tough market conditions. ?Globally there has been some slowdown in wealth creation but we think India has tremendous growth potential and the growth pace is higher than most other emerging markets. We also expect the wealth management business for Asia to grow faster than those of developed countries?, added Krishnan. Changing demographics and with people getting wealthy at a younger age there is scope for private banking to grow here, he added.
He did note that equity markets would re-bounce during the latter part of the year which would stir action in the private banking space. The bank also plans to hire more employees for its private banking business in India.
?The challenge is to hire the right people to fill the slots. We recently hired five employees and will add three more in the next two to three months?. Currently, for seven locations, the bank has a total of 70 employees spread across various teams like operations, compliance, research and front-line relationship managers. At HSBC, every relationship manager deals with 30 to 35 clients, said Krishnan.
Business owners dominate the private banking clientele in India. ?There are fewer conventional salaried people. They comprise just about 10% of the total customer base. We look at HNIs who have an investable surplus of $1 million with us,? he said.