MN6066 Assignment 2: Comparison of HSBC and Barclays Report

This report provides a comparative analysis of HSBC and Barclays, two major players in the global banking sector. It delves into their corporate governance structures, evaluating the roles of CEOs, Boards of Directors, and External Auditors in driving financial performance and meeting regulatory requirements. The report examines key aspects such as people management, strategic approaches, customer service, and overall financial performance, drawing insights from their annual reports. It highlights differences in their business models, customer bases, and approaches to employee relations and digital transformation. The analysis also touches upon instances of regulatory scrutiny and ethical considerations, providing a comprehensive overview of the banks' strengths, weaknesses, and future prospects. The report concludes with recommendations for improvement, emphasizing the importance of ethical practices, robust risk management, and strategic alignment with market demands.

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Practice of Management

Contents
Introduction................................................................................................................................2
Comparison of HSBC and Barclays in terms of people, strategy, customers, and performance
....................................................................................................................................................2
Conclusion and recommendations.............................................................................................4
References..................................................................................................................................5

Introduction
HSBC is found to be one of the biggest financial and banking organisations in the world
through 66 territories and countries. As compare to this, Barclays lends, moves, protects and
invests the money for clients and customer worldwide. It is seen that Citigrpup is the top rival
of Barclays. Citigroup has it’s headquarter in New York. Besides this, Bank of America is
also one of biggest competitor of Barclays. The estimated annual revenue of Barclays Plc. is
found to be around $28.4B. As compare to this, HSBC top competitor is UBS and Standard
Chartered. At the same time, Barclays is also found to be toughest competitor of HSBC
(Bavoso, 2016). In the paper, discussion has been carried on the comparison between HSBC
and Barclays bank.
Comparison of HSBC and Barclays in terms of people, strategy, customers, and
performance
The major focus of Barclay is on the retail banking and on UK-US investment. As compare
to this, HSBC always give emphasis on the needs of businesses and individuals in UK and
Asia. HSBC is the only bank who come one big five FTSE. It is found that HSBC total
assets increased by $55bn. It includes the favourable effect of the foreign currency on HSBC.
It has also made increase in its customer lending in every global business. However, it is
found that its balances and cash at ventral bank have decreased by $9bn. It is reflecting the
reployment of our commercial surplus. As compare to HS. BC, Barclays has total gross
exposure of £149.3bn. The loss rate of loan is 55bps.
(Roland, 2018)
From the above table, it can be stated that HSBC is able to make more return to the
shareholder for two reasons. The first reason is that its balance sheet already has more capital

as compare to the small banks. In the end of June, its common equity tier was 14.2 per cent in
comparison to the 13 per cent of Barclay.
HSBC serves approx. 1.5 million customers in 53 countries. The customer of HSBC ranges
from small businesses, corporate as well as domestic market. Services provided by HSBC
include term loan, working capital, international trade facilitation, payment services, financial
market access, and expertise in acquisition and mergers. These customers are serving through
retail banking, its main businesses, asset management, wealth management, and insurance
(Trudeau and McLarney, 2017).
HSBC staff members are given regular training and they receive their complaints on regular
basis. For the staff members, the time taken to resolve complaints is on the same day or
probably next day. For customers also, it made the significant investment in its digital
transformation of improving the usability and access to its customers. For its retail customers
also, it has upgraded the public website in different markets, mobile banking apps, and online
banking platforms. The major communication has been done through the social media/ for
dealing with the customers complaint specially, it created the “pain point” reports that tends
to highlight the key issues that are raised by customers. In comparison to the HSBC, Barclay
provides the share rewards and deferred cash to its employees for incentivising their
performance over the period. However, for receiving payment under award, employees are
required to provide the service in the vesting period. HSBC also believe in treating its staff
member with respect and dignity by creating the inclusive working culture. Staff members do
not face any kind of discrimination, harassment, bullying, victimisation on any ground such
as sexual orientation, disability, health conditions, pregnancy, marital status and some other
employment status, domestic circumstances, working hours and some other flexible working
arrangement, belief or religion (Barclays Plc.,2019).
In Barclays, board always engage with their stakeholders regarding discussion of the
information for helping them in understating the impact of Barclays operations (Howarth and
James, 2019). It always places its customer first by listening to their needs and demand. As
per customer concern, it is also providing digital experience to its customers. Ashok Vaswani
is the current CEO of Barclay UK. He helps the business to effectively work and capitalise on
its strengths as a wholesale bank and diversified consumer. It also looks after the consumer
banking, and payment business in UK. As compare to this, James Emmett is the chief
executive officer of HSBC UK (HSBC Group, 2019).

The board of directors in HSBC are Mark E Tucker, Noel Quinn, Ewen Stevenson, Kathleen
Casey, Laura Cha, Henri De Castries, Irene Lee, Heidi Miller, David Nish, Jackson Tai, and
Aileen. The objective of board of director is to ensure the delivery of sustainable value to the
shareholder. Board members regularly meet and receive the necessary information regarding
meeting and activities of committees. As compare to this, Barclays board of director team
includes the Nigel Higgins, Tuishar Morzaria, Jes Staley, Mike Ashley, Tim Breedon, Mary
Anne Citrino, Lan Cheshire, Dawn Fitzpatrick, Crawford Gfillies, Mary Francis CBE, Brian
Gilvary, and Diane Schueneman (Butterworth, McCaul and Barclay, 2016).
It is found that HSBC have higher standards of corporate governance by complying with the
provisions of UK finance council. In spite of this, HSBC came across money laundering
issue by indulging in illegal activities. In 2012 December, it is seen that HSBC has been
penalised for around $1.92 billion for violating the law. It has also given the warning many
times but it could not make any change. Besides this, HSBC has long history related to
payment failures, money laundering, charity programmes, as well as Forex scandal. As
compare to HSBC, Barclay has also been warned by one activist to stop the cycle of
disruption. This is the second time when it faced the regulatory enforcement investigation.
The latest news updated on Barclays has reported the fall in profit.
Conclusion and recommendations
In the limelight of above discussion, it can be concluded that HSBC bank is earning more and
is expected to rise in the coming years. The focus of Barclay is give on the retail banking and
HSBC give major emphasis on serving the needs of businesses and individuals. At the same
time, HSBC is able to make fair and generous return to its shareholder in comparison to the
Barclay. Both the banks tend to provide the training to its staff members in order to ensure
the working of banking system in right manner.
It is recommended to banks for working on the effective programme that will ensure the
improvement in its ethical violence and illegal activities. Training programmes can be
provided to the employees regarding the proper guidance. At the same time, Barclay is also
recommended to introduce the accounting procedures and cask handling a workplace. This
will ensure the correct functioning of the organisation in legal manner. At the same time, it
should also start using such models that will help in assessing the client risk for any project.

HSBC should improve its provision by making strict guidelines for its staff. It will help in
stopping the illegal activities going on in bank.

References
Roland Head. 2018. HSBC vs Barclays: which FTSE 100 bank could provide the best
retirement income?. [online] Available from:
https://www.fool.co.uk/investing/2018/08/19/hsbc-vs-barclays-which-ftse-100-bank-could-
provide-the-best-retirement-income/ [accessed 1/03/2020].
Barclays PLC. 2019. annual report 2019. [online] Available from:
https://home.barclays/content/dam/home-barclays/documents/investor-relations/reports-and-
events/annual-reports/2019/Barclays%20PLC%20Annual%20Report%202019.pdf [accessed
1/03/2020].
HSBC Group. Annual report 2019. [online] Available from:
https://www.hsbc.com/investors/results-and-announcements/annual-report
Trudeau, C. and McLarney, C., 2017. How can banks enhance international connectivity with
business customers?: a study of HSBC. IUP Journal of Business Strategy, 14(2).
Crane, A., Matten, D., Glozer, S. and Spence, L., 2019. Business ethics: Managing corporate
citizenship and sustainability in the age of globalization. Oxford University Press, USA.
Butterworth, C., McCaul, L. and Barclay, C., 2016. Restorative dentistry and oral
rehabilitation: United Kingdom national multidisciplinary guidelines. The Journal of
Laryngology & Otology, 130(S2), pp.S41-S44.
Bavoso, V., 2016. Financial innovation, derivatives and the UK and US interest rate swap
scandals: Drawing new boundaries for the regulation of financial innovation. Global
Policy, 7(2), pp.227-236.
Howarth, D. and James, S., 2019. The politics of bank structural reform: Business power and
agenda setting in the United Kingdom, France, and Germany. Business and Politics, pp.1-27.