HSBC Bank (NYES: HSBC) has been revamping its US business for a long time, to come out of the overall slump and keep pace with its American counterparts. Strengthening the turnaround efforts, the UK-based bank this week picked a senior executive from rival Citigroup [C] to head its US operations.
The appointment of Michael Roberts, who has served Citi for more than three decades, came within a day after long-term executive Patrick Burke announced his retirement from the post of chief executive officer, at the age of 57. The management expects that Roberts’ appointment will help the company expedite its journey back to profitability, a task it has referred to as ‘the most challenging priority.’
Roberts, who ended his 34-year career in Citi to join HSBC, served as the chief lending officer and global head of corporate banking and capital management, most recently.
Last year, return on equity in the US came in sharply below the average. While HSBC continues to register dismal financial numbers in the US, it performed exceptionally well in the other key markets.
Now, it needs to be seen to what extent would Robert be able to unlock the capital that is stuck in the local market. At one point, there was speculation that the management will resort to significant downsizing to put the bank back on track.
The latest management change comes on the heels the company unveiling an aggressive plan to broaden its local operations by opening 50 branches in the US and adding 300 more people to the workforce. HSBC is one of the few banks that still struggle to come out of the catastrophe set off by the subprime mortgage crisis more than ten years ago.
HSBC shares traded slightly lower Monday afternoon, extending the downtrend that began more than a year ago. The stock, which lost about 23% since last year, witnessed some improvement in the past six months.
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