Only challenge predicted is 'getting good staff'

HSBC Insurance Brokers is planning a big push in Asia, kicking off with a deal to move from part-ownership to full control of its Chinese company.

Chief executive Philip Gregory said HSBC would also open an office in Vietnam to “complete the Asian picture”.

Gregory said China was a “future growth engine”, and HSBC would extend its 25% stake to 95% in its Chinese company, called Beijing HSBC Insurance Brokers Ltd.

Beijing HSBC Insurance Brokers Ltd has 60 staff across three offices in Beijing, Shanghai and Guangzhou, dealing in directors’ and officers’, product liability and construction risk.

Gregory said HSBC would let the big three brokers scrap it out for the multinationals, while HSBC brokered for large local businesses, helped by the force of the brand name.

Gregory commented: “We will expand. And the opportunities for expansion in China are excellent. The difficulty everybody has in China is getting good staff.”

Both Asian deals should be completed within the next few months, pending regulatory approval.

The UK accounts for most of HSBC’s £146m brokerage, with the rest coming globally. HSBC’s aim is to drive up that contribution.

Gregory said HSBC’s Dubai operation had suffered owing to the downturn in the emirate, but the lost ground in the Middle East had been made up by operations in Saudi Arabia, Abu Dhabi and Qatar.

Gregory said: “I can see no point in doing large corporate acquisitions in the UK. I can see the need to do a corporate, tactical auction to get us going and to get us critical mass, possibly in an overseas country where we decide over time we wish to position ourselves.

“But ultimately, I am interested in recruiting people and hiring teams, because we have the infrastructure.”

Last month, HSBC Bank revealed that AXA had won the account to insure new businesses. Gregory said the firm would continue to broke for the bank, although only for large mid-sized corporate business.