HSBC is boosting its transfer agency (TA) services division as part of a group strategy to provide global across-the-board securities services, incorporating custody, fund administration, stock lending and prime broking.
The UK bank faces tough competition in Asia, though, as other securities-services providers are seeing growth and boosting their capabilities in the region, among them BNP Paribas, BNY Mellon, Citi, Deutsche Bank, JP Morgan and State Street.
HSBC has spent $45 million in the past three years on expanding the TA services business, says Gina Slotosch, London-based global head of product management for TA services.
This is part of a strategy whereby the group ultimately aims to offer a global "one-stop shop" for all securities services, she tells AsianInvestor. This will involve consolidation and centralisation -- for example, of the bank's core global custody platform -- and streamlining of technology and processes, which began two years ago and will continue for the next two.
Another step towards this objective was Philippe Bonval's promotion to head of product management in the TA services division for Asia-Pacific and the Middle East at HSBC Securities Services.
Bonval moved to the new post in April from his previous role as head of TA implementations for Asia and Europe, and he remains in Hong Kong. Reporting to Slotosch, Bonval is now responsible for identifying market and product opportunities and developing the TA services product strategy for Asia and the Middle East.
His responsibilities previously fell under the remit of Slotosch's Hong Kong-based predecessor, Jitendra Somani, and Somani's team. But the structure has now changed, says Slotosch, who took over from Somani when he became global head of custody for Asia-Pacific in February.
Bonval will remain up-to-date on regulatory moves to keep on top of which products are required on a global and local basis, says Slotosch. She cites upcoming changes such as Ucits IV, due to come in from July 2011 and which will have a significant effect on the TA business both in Europe and Asia.
Asia-specific examples include the Hong Kong Monetary Authority's introduction last August of its CMU fund order-routing and settlement service, says Slotosch. The new service is provided by the HKMA's central money-markets unit (CMU) with a view to developing the necessary infrastructure to help standardise and automate often complex and fragmented investment fund processing.
Another instance of a recent rule change is Malaysia's introduction last month of multiple share classes (which will allow unit trusts -- the country's equivalent of mutual funds -- to be sold in currencies other than ringgit). (See the May 2010 issue of AsianInvestor magazine for more on this and other regulatory moves in Malaysia.)
Bonval, too, points to areas where he feels HSBC's product knowledge will be useful in the region. "One of them is STP [straight-through processing] in order routing and settlement, where the region can benefit from tools already used in other parts of the world," he says. "Our goal is to support our clients in finding a more cost-effective route to globalisation and distribution."
Reflecting HSBC's history of buying local banks, the firm is now linking up TA products more closely, to help create local as well as global products, says Slotosch.
"Local product management on a global basis is something we've introduced within HSBC in the past two years," she says. "Our global product management team is located across regions rather than having one team in one location -- this ensures that we understand the needs on a global basis."
With regard to specific Asia-Pacific markets for TA services, HSBC covers Australia, Hong Kong, Indonesia, Singapore Taiwan and Vietnam, and plans to expand that list in the coming months, says Slotosch, and possibly this year.
TA products are very important for the fund houses, she says, and where the bank expands its business depends on where its clients are looking to do business.
HSBC is planning further TA services hires in Asia-Pacific, but Slotosch says these are at very early stages and she would not give an estimate of likely headcount.
Before joining HSBC in 2007, Bonval held senior roles with State Street, RBC Dexia, Clearstream and Deutsche Borse. He has also been a management consultant for transfer agency and fund distribution at Consulting Services to Investment Managers in Luxembourg. He helped create Vestima, the Clearstream Deutsche Borse Fund order-routing platform, in 2001.
HSBC Securities Services provides services through its three component business units: corporate trust and loan agency; custody; and fund services. It has assets under custody of $5.1 trillion and assets under administration of $2.6 trillion (as of December 31).