The Lion Wakes – A Modern History of HSBC (Richard Roberts & David Kynaston)

ISBN:978-1-78125-055-6

Verdict: 👍👍 👍 👍 

 

The story of the Hongkong Shanghai Banking Corporation (HSBC) is a truly remarkable one in which the transformation from a small bank located in a small fishing village, on the Hong Kong waterfront 155 years ago, to that of one of the largest financial global businesses and hence worthy of a understanding in terms of development , ethos and culture – This book covers some of the years from 1970 to 2014ish.

 

The book charts the history and key decisions surrounding some major global events in history e.g. the transfer of the island of Hong Kongs sovereignty back to China when the lease expired and the subsequent decisions made to ensure the associated risks were mitigated from political and economic forces.

 

The 622 pages of banking history is not for everyone and mapped to major economic events which makes it an interesting read and my highlighter 📝 was fully used ! – There are several pearls of economic wisdom and highlights of the banks adopted philosophies here are a few;

• The bank undertook to honour in full HK16 Million (£7.5m) Hong Kong notes that had been illegally issued in the banks name by the Japanese in 1942 (P16) – they didn’t have to do this but for the sake of the reputation for integrity they did.
•   “No Matter how many times one reads Freud, sooner or later , for practical experience , one has to go out with a girl” P44 – Quote from a one of the GMs 
•   “ Today a rooster, tomorrow a feather duster” –(P208)  John Bond 
•  Success in financial services probably means devoting 90% of your time to execution and only 10% to strategy” (P208) John Bond
• “In a world where banks can go bust thanks to misbehaviour of one dealer. HSBC is a Safe harbour” (P212 - Financial Times 2nd May 1984)
• (P255) - HSBCS Culture and operational benefits;

§  Prudence

§  Diversity of risk

§  Common standards 

§  … but tailored solutions

§  Sharing of ideas and links across group 

§  Sharing and strict control of costs 

•  “was that in a time of crisis its always just about liquidly, liquidity, liquidity”  (P363)
• ‘If we have a point to make’, he added, ‘we will make it personally and discretely’ (P474) 

·       Re the internal audit report Jan 2007 – “HSBSCs senior management moved promptly to: ‘1. Fix the problem. 2.Protect the HSBC brand 3. Make a new Business plan” (P593) 

·       Nov 1998 the Holding Board endorsed Managing for Value (MvF)- See Diagram below;

 ‘A bank wants three things RM Gray told shareholders in Hong Kong in 1899 ‘viz.. good character, good management and solid resources of its own. In the absence of any of these , pronounced success will be impossible’ (P646) 

The book highlights how through acquisitions, political turmoil, global financial crashes (US sub-prime) etc  that HSBC conducted itself with great honour - used its internal resources to get itself out of problem areas and did not like many ask for government subsidiaries – makes one want to bank with them.

I did enjoy this bit of banking/history despite the length of read ! .