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Purchase accelerates HSBC's growth

HSBC aims to still target high net worth individuals and be a niche rather than mainstream player, even though it has just bought AMP Banking's mortgage book.

Monday, April 28th 2003, 2:51AM

by Jenny Ruth

Buying AMP’s New Zealand retail banking business has catapulted HSBC into being the nation’s sixth biggest bank behind ASB Bank with total assets of about $5.3 billion.

Before the purchase, HSBC’s assets were $3.1 billion.

HSBC head of retail banking Alex Bentley says the bank is going to need to recruit upwards of 60 people to run the combined operation and will be offering jobs to AMP’s existing 35 retail banking staff.

While much of the AMP banking operation had been run out of Australia, HSBC is looking to substantially run its New Zealand business locally.

"The reason AMP has had to sell its bank isn’t because of the people who worked for it. One thing that’s really impressed me … has been the calibre of the AMP people. I would love to bring in many of them because they bring all that intellectual knowledge of the business which is critical to us," he says.

While Bentley says HSBC has been growing quite nicely in an organic sense in New Zealand – assets grew 42% last year, the AMP purchase accelerates its growth strategy by about three-and-a-half to four years.

In the past, HSBC has targeted high net worth individuals and has aimed to be a niche rather than mainstream player.

Bentley says the bank will still be targeting that sort of customer. Between 70% and 80% of AMP’s customers fit into that category and the remainder are "middle or emerging market. From what we’ve seen of the business so far, they look like they’re targeting people who are on the up in terms of income and wealth."

He says one reason why HSBC, which has been operating in New Zealand since 1987, hasn’t grown faster, despite offering very competitive home loan rates, is that it has been careful not to overburden itself.

Given the type of customers it wants, "you have to give them the first class ride they expect, because they won’t come back a second time."

HSBC is buying AMP’s A$1.6 billion residential mortgage portfolio in New Zealand and, subject to customer consent, will take on AMP’s A$355 million New Zealand retail deposit portfolio. It will also enter into management and funding arrangements over a further A$135 million of mortgages. The purchase is expected to be completed by the end of May.

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 4.94 - - -
AIA - Go Home Loans 7.49 ▼5.79 ▼5.49 ▼5.59
ANZ 7.39 6.39 6.19 6.19
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 5.79 5.59 5.59
ASB Bank 7.39 ▼5.79 ▼5.49 ▼5.59
ASB Better Homes Top Up - - - 1.00
Avanti Finance ▼7.90 - - -
Basecorp Finance ▼8.35 - - -
BNZ - Classic - 5.99 5.69 5.69
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One 7.54 - - -
BNZ - Rapid Repay 7.54 - - -
BNZ - Std 7.44 ▼5.79 ▼5.59 5.69
BNZ - TotalMoney 7.54 - - -
CFML 321 Loans 6.20 - - -
CFML Home Loans 6.45 - - -
CFML Prime Loans 8.25 - - -
CFML Standard Loans 9.20 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 5.69 - -
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Owner Occ 6.95 5.79 5.59 5.69
Co-operative Bank - Standard 6.95 6.29 6.09 6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - ▼5.99 ▼5.89 -
First Credit Union Standard ▼7.69 ▼6.69 ▼6.39 -
Heartland Bank - Online 6.99 ▼5.49 ▼5.39 ▼5.45
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.60 6.65 6.40 -
ICBC 7.49 ▼5.79 ▼5.59 5.59
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 7.25 6.89 6.59 6.49
Kiwibank - Offset 7.25 - - -
Kiwibank Special 7.25 5.99 5.69 5.69
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 7.94 ▼5.75 ▼5.99 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 7.49 6.95 6.29 6.29
SBS Bank Special - 6.15 5.69 5.69
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo 4.94 5.15 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.75 - - -
TSB Bank 8.19 6.49 ▼6.39 ▼6.39
TSB Special 7.39 5.69 ▼5.59 ▼5.59
Unity 7.64 ▼5.79 ▼5.55 -
Unity First Home Buyer special - 5.49 - -
Wairarapa Building Society ▼7.70 ▼5.95 ▼5.75 -
Westpac 7.39 6.39 6.09 6.19
Westpac Choices Everyday 7.49 - - -
Westpac Offset 7.39 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 5.79 5.49 5.59
Median 7.49 5.97 5.75 5.69

Last updated: 6 December 2024 9:11am

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