Hsbc in China, International Business Strategy Analysis

HSBC in China Case Analyses from Luthans & Doh, In-depth Integrative Case 4.1

Chander ZHU Dec. 2014

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in China  

Hong Kong and Shanghai Banking Corporation was founded to finance the growing trade between Europe, India and China in Hong Kong March 1865 and month later in Shanghai. (King, 1987) With its longtime settled in China, HSBC is already member of top tier financial institutions operating in the biggest emerging market and been the largest foreign banking group in China. This essay is aiming to exam the strategy of HSBC revolution over the years in China, meanwhile to illustrate the HSBC’s strategy changed before and after China’s accession to the WTO. Then, the strategy of HSBC’s expands in China’s rural areas will be mentioned with both evaluation of advantages and disadvantages. Following, the strategy of HSBC on how to enter and operate in the other emerging markets will be discussed in terms of successful cases and setbacks. Finally, the influence from world economic crisis on HSBC and future potential opportunities for HSBC will definitely be focused on.

Before the WTO accession in 2001, China’s banking industry relied on directed lending practices from government, in turn created many China’s most successful enterprises under centrally planed economy. This approach resulted in thousands of state-owned enterprises, which were unprofitable and inefficient and made the state-own banks widespread lost because of largely unrecoverable debt and hoards of loans cannot be performed. Since initially opened in 1865, HSBC expanded widely by opened agencies and branches while kept eyes on potential markets...