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HSBC to invest $15-17 billion by 2020 in push for growth

Reuters  |  LONDON 

By Lawrence White

(Reuters) - will invest $15-17 billion in the next three years in areas including technology and as it swings from a strategy of cost-cutting to growth, new said on Monday, while keeping profitability and dividend targets little changed.

In a first public outline of his strategy at the helm of Europe's biggest by market capitalisation, Flint set out ambitions to grow its return on tangible equity to 11 percent, in line with previous targets, from 6.8 percent in 2017.

The update marks a shift in HSBC's post-2008 crisis attitude from cost-cutting and restructuring to investment and growth, but analysts said the focus on and technology were familiar themes.

shares fell by 0.7 percent amid some disappointment the said it would keep its current levels of dividends rather than the increase some investors had hoped for.

"The early read is that this is not a revolutionary strategy review - rather accelerating growth (particularly in Asia) as well as driving better value creation," at in said.


The main points of the bank's refreshed strategy will come as little surprise to investors, with the focus squarely on further expansion in and its prosperous southern region in particular.

The will also seek to expand further in the British mortgage market as one of eight new strategic targets, it said.

"After a period of restructuring, it is now time for HSBC to get back into growth mode," Flint said.

The bank has found no silver bullet for its underperforming U.S. business, the strategy update showed, with HSBC set to focus on trying to grow its market share among internationally-focused mid-sized companies.

The bank will also resume unsecured lending in its retail bank, taking on the riskier but more profitable segment of the consumer market that drives the higher profits achieved by its domestic rivals in the

Flint in February said the bank was reviewing its U.S. franchise, which has suffered from lack of scale and the consequences of its disastrous $15 billion acquisition of Household in 2003.

Few of the bank's identified areas for growth focused on its business, which has suffered an exodus of high-profile dealmakers in in recent months amid frustration at a lack of clear strategy.

(Reporting by Lawrence White; Editing by and Mark Potter)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, June 11 2018. 15:49 IST