Case | HBS Case Collection | April 2012 (Revised July 2012)

Capitalizing for the Future: HSBC in 2010

by Anette Mikes and Dominique Hamel

Abstract

Following the financial crisis of 2007/2008, HSBC CEO Michael Geoghegan saw a fundamental change in global opportunities and risks. With increasing regulation and fierce competition between banks, the Western hemisphere was going to be a tougher place to do business. Emerging markets, however, offered many opportunities. Geoghegan reasoned that in HSBC's case, a turn to emerging markets would be a return to its roots and to managing risks that it knew. But HSBC needed to understand what the implications of the new strategy—"moving to emerging markets"—were for its portfolio and overall risk profile. Especially, how should HSBC reallocate capital freeing up in the West across its diverse geographies and business lines?

Keywords: accounting; competitive strategy; control systems; finance; Financial Crisis; Banks and Banking; Emerging Markets; Risk Management; Business Strategy; Banking Industry;

Citation:

Mikes, Anette, and Dominique Hamel. "Capitalizing for the Future: HSBC in 2010." Harvard Business School Case 112-097, April 2012. (Revised July 2012.)