With an eclectic mix of businesses in 79 countries, HSBC Holdings PLC of London says it tries to act globally while adapting to local markets.

"We will run our businesses on a global basis where it makes sense," said Malcolm Burnett, chief executive officer of HSBC Americas Inc., the banking company's U.S. operating unit. "But we will also have different products in different markets, depending on the market."

To that end, when HSBC two years ago bought First Federal Savings of Rochester, N.Y., it let First Federal's customers keep their passbooks- though passbook savings had been dropped in HSBC's U.S. offices.

"We kept the passbooks because that's what they felt comfortable with," Mr. Burnett said of First Federal's customers. "At the end of the day, you have to remember that banking is still about people dealing with people."

HSBC, with $484 billion of assets, competes in businesses as diverse as retail banking in upstate New York, private banking in Germany, and commercial banking in the Middle East.

Mr. Burnett, 51, is responsible for the company's North American businesses, including $34 billion-asset Marine Midland Bank; Hongkong Bank of Canada; and HSBC Markets Inc., parent of HSBC Securities Inc. A 33-year veteran of the company, Mr. Burnett has held his post for a year.

In a recent interview, Mr. Burnett said that in the United States not all strategies will be tailored as locally as the First Federal passbook decision. Cash management, trade finance, and payment operations, for example, will be run on an integrated worldwide basis from London.

But retail banking and U.S. corporate banking will be run from Buffalo, Marine Midland's base. Mr. Burnett said he plans to move the U.S. bank deeper into retail and middle-market banking, especially in the New York metropolitan region, where it still has only a small market share.

"Any changes we make will be evolutionary rather than revolutionary," Mr. Burnett said.

Indeed, HSBC is unlikely to make a large acquisition in the United States because of high prices, he said. But the company might make some small deals to strengthen its market presence.

Last October, for example, HSBC agreed to a $24 million deal for First Commercial Bank of Philadelphia, a $90 million-asset bank with two branches catering to the Asian immigrant community.

On a more global level, HSBC last November said it would put all its worldwide operations under the same name-HSBC. By giving far-flung units- including Marine Midland in the United States, British Bank of the Middle East, and Trinkhaus & Burkhardt in Germany-a common brand, HSBC said, it hopes to strengthen its market image and help boost investor awareness of the scope of its activities.

HSBC also said it would adopt common strategies for selected worldwide operations, including personal banking services, small-business banking, and asset management and insurance.

In a recent in-house publication, HSBC chairman John Bond said the change was needed because fast growth in recent years had stretched management to the limit. But he emphasized that local units would continue to enjoy a large measure of autonomy.

"We are certainly not moving from geographical to functional management," Mr. Bond emphasized.

So far, the earnings record would suggest that the company's strategic flexibility has worked.

Though HSBC is expected later this month to report a decline in 1998 earnings due to the recession in Asia, net income at HSBC Americas Inc. rose 32% in the fourth quarter, to $158.6 million. Net income for the year was up 12%, to $527.1 million, yielding a 25% return on equity.

One reason for the high earnings, Mr. Burnett said, is a tight control on expenses.

"We pay a lot of attention to details," he said, "and we pay a lot of attention to what we spend."

Analysts like Nick D. Collier of Morgan Stanley Dean Witter in London said they see no reason to contest that view.

"Their goal is to concentrate on core skills in commercial banking through local bank franchises whether it be in Asia, the U.S., Europe, or Latin America," said Mr. Collier. "The strategy may sound vague, but execution is very powerful."

He added that the key to understanding how HSBC works lies more in its executives than in its strategy.

"The secret of their success is the cultural integrity of their management team," Mr. Collier said. "That allows them to transfer values, technology, and systems very effectively and avoids problems with fiefdoms or political infighting."

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