At a press briefing in Hong Kong yesterday (Thursday), HSBC outlined what it sees as some of the key developments in e-commerce initiatives taken by the bank over the past year. Central to these are the bank's online FX trading facility and its involvement with the BondsInAsia trading platform for fixed income securities.
Tony Cripps, head of e-commerce for the Asia pacific region, admits that the bank may not have been vocal about HSBC's commitment to this side of the business before, but that was very much a deliberate ploy as the bank strove to provide products with substance more than style.
"We've not been overly active in marketing our activities in the past two years but we have been doing a lot of work in integrating our online strategies with our traditional business," says Cripps. "E-channels are not separate to our core activities and the integration of the two has been one of the key achievements in the last 12 months."
HSBC has been using the FX platform for over a year now and in the time since; there have been over 20,000 trades worth a total of $20 billion completed using the platform.
When the new FX trading system was launched, the bank expected that after two years more than 50% of business would be conducted through the internet. The bank's clients have had access to the platform for six months and already 20% of volumes are being conducted through this mechanism.
Cripps feels there are numerous advantages to conducting business in this way. "The platform not only lowers costs, but it also frees time for the sales guys who would previously process the trades manually," he explains. "That gives the sales team more time to speak to customers and provide a better service. This is the beginning of where technology gives real benefits both externally and internally."
HSBC also hopes that the increased transparency from being able to see what trades are taking place on screen will result in pricing that more accurately reflects market conditions. This, in principle, will also result in less divergence in pricing between different banks.
Paul Hand, head of sales for treasury and capital markets in the Asia-Pacific countries, was quick to dismiss the idea that increasing automation in the business will lead to a reduction in manpower.
"I think the impact will be negligible," he responds. "What will happen is that we will see the roles of sales people changing. They will become more like advisors and not so much processors of trades."
With the FX business already accessible to clients, HSBC's next area of focus will be to fully exploit the BondsInAsia platform. So far, HSBC has been conducting a series of internal trades to test the system but expects that clients will start to go live on the system sometime this month.
