Emerging markets and opportunities

Emerging markets are at the heart of HSBC's corporate identity. Throughout its history, the HSBC Group has maintained a strong presence in global trade, particularly in India and China, the world's most dynamic emerging markets.

HSBC has been a participant and a witness to the development of emerging markets for over a century. We have established branches even in countries that were considered closed, restricted or highly centralised. Over the years, HSBC rose to the status of a respected institution as it worked actively in these markets.

Sensitive to the unique cultures in emerging markets, HSBC has often been the first foreign bank to work in partnership with local businesses. HSBC Amanah was among the first to offer Islamic banking products and has the largest Islamic banking team of any international bank.

HSBC Group Chairman Stephen Green, at the 2009 Annual General Meeting, reported, "I am pleased to say that your company has withstood the storm far better than most. This is due in large part to our trademarks of financial strength and conservative positioning. We were one of the most profitable banks in the world in 2008, albeit at a lower level than 2007."

While some institutions have struggled in the turmoil that struck many of the world's financial markets last year, HSBC posted pre-tax profits of USD9.3 billion in 2008. Although representing a 62 per cent drop over 2007 performance, the Bank’s strong fundamentals have allowed it to pay out dividends to shareholders in the amount of GBP4.6 billion, the second highest of any bank in the world and the third highest payment in the FTSE100.

Source: From 2008 Final Results - Highlights, HSBC Holdings plc

There has been a shifting in the positions of the regions in terms of contribution to HSBC's numbers. In 2007, Europe, followed by Hong Kong, the rest of Asia-Pacific (including the Middle East), Latin America, and finally North America contributed to the Group's pre-tax profits, in that order. But the highest growth was from Asia, the Middle East and Latin America.

In 2008, filling up the vacuum left by the pronounced economic downturn in the United States, Europe still contributed most to profit (116.7 per cent) and registered 26 per cent growth versus year-ago performance. But the rest of Asia-Pacific (including the Middle East) registered the highest growth (up by 27 per cent). Hong Kong, although second in terms of contribution to HSBC Group results, actually slowed down in terms of growth (down by 26 per cent). Latin America's performance also dropped by six per cent.

The Bank's good relationship with host governments and regulatory bodies in these markets puts it in a strong position to advocate for financial reforms for the benefit of its clients and the industry. This rich international background serves Global Banking and Markets well, as we deliver a host of financial solutions for clients seeking expertise and experience in emerging markets.

"Although no region is immune to the crisis, the fast-growing economies in Asia and other emerging markets remain relatively robust and well-placed," the Chairman said.