HSBC Seeks To Emerge From Citigroup's Shadow

The New York Times has a positive article this week on HSBC. The focus is that the bank's investment banking division is successfully playing catch-up to the big-boys and has even got the mighty Citigroup in its sights.

The newspaper reminds us that HSBC won its first 'big investment banking victory' recently when it acheived co-adviser status on the $8.2bn Harmony Gold bid for Gold Fields. But whilst this is true, the bank has spent millions building up its investment banking division over the last two years or so, and has very little to show for it. For all that dosh, HSBC has pulled in $18.3bn of advisory mandates in the first three quarters of 2004 and the firm is standing a lowly 24th in the Thomson Financial global advisory league table for the year through September. 12 months ago, HSBC was in 16th place.

So, the jury is still out on the performance of the bank's investment banking division and there remains a huge chunk of daylight between HSBC and the major players. Many had expected far more to be acheived by now and point admiringly to Bruce Wasserstein over at Lazard. Despite all the politics there, Bruce has had the firm heading swiftly up the advisory league tables in the last two years and the firm is now well-placed for IPO and greater glory ahead.

Finally, there were press reports over the weekend that all post received at HSBC Investment Management is now routinely opened by the firm's compliance department before it is distributed to the appropriate areas. It has been said that many departments do not now receive their post until lunchtime. And the reason for this Draconian measure is said to be the fact that there have been 'a spate of complaints from clients about poor performance at the division'.

HSBC has confirmed that the post is opened before being passed to fund managers, but has denied that staff at the firm's compliance department are reading the mail beforehand.

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