“We are number one and we are three times [the size of] number two.” This is how Abdul Hakeem Mostafawi, the CEO of HSBC Qatar, positions his bank among the group of international lenders currently plying their trade in Qatar. While this statement shows a strong sense of self-belief, the hefty presence of big local banks in the market means that there is no suggestion that Mostafawi is resting on his laurels.
As Mostafawi says, global connectivity is the real strength of HSBC. “Nobody has the same footprint that we have,” he says. “We are in a better position to serve multinationals because we, as a bank, are everywhere. If they want to open up activities in India or in Latin America, we are there as well. They need a bank to be there with them wherever they go and we are everywhere.”
With more than 6,900 branch locations in about 80 countries, “everywhere” is not a complete exaggeration.
HSBC’s net profit grew by an impressive fifteen percent in 2012, and the lender doesn’t appear to have been affected by the Qatar Central Bank’s decision to force conventional banks to pull out of Islamic financing operations.
“It didn’t have a significant impact because we were just getting into it [Islamic banking],” Mostafawi says. “It was just six months [after] we got into it, so in terms of our expectations for future growth it has an impact, but not a direct immediate impact.”
In reality, HSBC had only a few clients in its Islamic banking branch. It may not have been a huge portfolio, but Mostafawi believes that the trend towards Islamic banking is growing much faster than conventional banking. In that sense it could have been an interesting sector to explore in terms of future profits.
“Regardless [of the fact] that I don’t like it, it was the right thing to do for the country,” Mostafawi says. “You can’t take a liability from a conventional institution and use it in an Islamic bank because conceptually as an Islamic product that’s wrong. By having it both together, you have no choice but to do that.”
If 2012 was a positive year for HSBC, then the outlook for 2013 is also looking good.
“Our expectations for 2013 are even better because there are a lot of projects coming up; we are already hearing about tender bonds, bank guarantees already issued for some clients, so the trend in terms of economic activity is in an upward direction. So we are hopeful that 2013 is going to be better than last year,” says Mostafawi.
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