Barclays celebrates its 50th anniversary in Hong Kong, building on its success in the region and looking towards a greener future
- The bank’s evolution into an investment model has been concurrent with the city’s growth as a financial hub
- It is leveraging a research platform built by its UK network to help the city develop as an ESG capital in Asia
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As Hong Kong has developed into a global financial centre, Barclays has undergone its own evolution in the city, transforming from a retail bank into a corporate and investment bank.
The company, which this year celebrates a 50-year presence in Hong Kong, plans to build on this momentum, leveraging its strengths to continue to serve its customers and help Hong Kong develop into a hub for green finance.
Anthony Davies, chief executive of Barclays Bank in Hong Kong, says the anniversary comes at an interesting time for markets: “Financial services always evolve, and they evolve very quickly – whether that is due to the advent of technology, the change of people or new or changing markets. You are constantly having to evolve your business, and that’s been very true for us over the last 50 years.
“We started in Hong Kong 50 years ago as a retail bank with branches in the city. Our business model today is very different, and we’ve undergone a few strategic changes to adapt to being very much focused on the corporate and investment bank model.”
Today, the bank operates two core areas of business in Hong Kong. It has a cross-border business, connecting foreign investors with onshore opportunities in mainland China, and onshore investors and institutions with overseas investors.
Meanwhile, its Hong Kong branch acts as an Asia-Pacific hub for a number of its businesses: investment banking operations covering a full spectrum of strategic advisory, financing and risk management solutions to large corporate, government and institutional clients; the global markets business covering risk management across rates and FX products, equities, credit, securitised products, prime services and fixed income financing; and finally, research, delivering differentiated market insights across asset classes.
“Another key change for us has been to transition from a revenue-focused model to a returns-focused model,” Davies says. “We focus on what we are good at and deliver consistently excellent outcomes for our clients, instead of trying to do everything.”
He adds that in the past two years, Barclays has seen growth in Hong Kong, as it has built its product offerings and strengthened the products already offered.
“We know we still have market share to gain and more products that we can launch. The global economic situation has presented markets with challenges, but there are still pockets of opportunity if done right, and this is especially true in Asia-Pacific,” he says.
Davies is optimistic that Hong Kong’s unique geographical position and role as a connector to mainland China will continue to create commercial opportunities, despite the headwinds the Chinese economy is facing.
“The scale and the size of the economy is such that the opportunities are still significant. Even if growth slows, there will still be companies that need to come to Hong Kong to raise finance.
“We will have to be very thoughtful about how we deploy our capital, but the depth of our relationships with our clients will enable us to work with them to find strategic solutions,” he says.
A legacy of expertise
Barclays, which has a history of more than 330 years in the United Kingdom and is ranked as one of the top six global investment banks, will continue to leverage the strengths of its international business to help its clients in Hong Kong.
Davies is clear that another key strength of its operations in Hong Kong is its people, and its ability to attract and retain top talent. It does this by offering its employees the opportunity to evolve with the bank as it executes a defined growth plan, as well as placing an emphasis on creating a collaborative culture.
“We spend a lot of time breaking down silos,” Davies says. “We’re not as big as some of our peers, so the only way we are going to win is to hunt as a pack. People go out of their way to help each other and work together as a team.”
The success of this approach is reflected by the fact that, despite the current competition for talent largely caused by an exodus of financial experts from Hong Kong, the bank has grown its headcount in the city by almost 20 per cent over the past two years.
Since becoming chief executive of the Hong Kong branch in 2016, Davies has also strived to introduce a distinctive culture, underpinned by the group’s common goal of fulfilling a societal need, and its core values of respect, integrity, service, excellence and stewardship.
The bank promotes inclusivity through its employee networks, including a women’s network and an LGBTQ network, while it also hosts community engagement events with its charity partners in Hong Kong. It also gives back to society through its sponsorship of MoonTrekker, an annual overnight trail race on Lantau Island.
“It is an incredibly popular event with our clients and other corporations. We use it to raise money and awareness for environmental issues in Hong Kong,” Davies says.
A greener future
Environmental issues are also crucial to Barclays’ future business, as it seeks to assist Hong Kong in its development as a green finance hub. Green financing opportunities in Asia are significant, particularly in terms of renewable energy, and Hong Kong has a major role to play as both a centre in which to raise money, and one in which environmental, social and corporate governance (ESG) standards are set.
“The ESG debate has reached a critical juncture, and where it goes from here, particularly with energy prices, could go backwards if we’re not careful,” Davies says. “We need a more definitive set of regulations to set how ESG is interpreted and what it means for people and companies going forward.”
Barclays Hong Kong is using a research platform built by its UK network and other resources available to put an Asian lens on the research that comes out of its London headquarters.
“We also have a dedicated Sustainable and Impact Banking Group, and we are very strong in delivering financing for green bonds and green financing. ESG is very important to us here at Barclays, and we are in the process of embedding it into everything we do,” Davies says.
The bank has set its own internal and external net-zero targets of 2030 and 2050 respectively.
It is one of the founding partners of the Shared Value Initiative Hong Kong – an initiative driving a purpose-led business movement to plan new economic opportunities so that they will have an equally measurable benefit for social and environmental issues.
Since 2016, Barclays has been in a strategic global partnership with Unreasonable Group, supporting as an incubator for more than 200 high-growth entrepreneurs whose businesses address pressing environmental issues and have the potential to create the jobs of the future.
About Barclays in Hong Kong