Richard McHowat, the CEO of HSBC Thailand, quickly dispels any preconceived notions I have of bankers by bounding across his office to meet me and then immediately leading me on a tour of his premises. With his strapping frame, Richard could easily pass for a corner linebacker albeit a bright and astute one.


The media has not been kind to bankers generally portraying them as wizened, key-nieow, old men sitting behind their desks talking in monosyllables and depositing dirty money into dirty accounts. Richard breaks this mold all to hell.

Overflowing with energy and enthusiasm, so much so that Tony Robbins could probably take lessons from him, Richard leads me on his tour and it becomes quickly evident that he cares about his staff and their success a great deal. He’s not just talking the talk, he’s walking the walk, as he has spent a great deal of time trying to find out what makes them tick so he can best optimize their performance levels and just generally give them a better work environment. He takes cultural sensitivity seriously.

Richard then takes me to the front door to show me the two (brass?) lions at the entrance, which were designed by a Thai artist who made them by first traveling to Hong Kong to take a clay mold of the two originals (Steven & Stitt) guarding HSBC’s headquarters on Queen’s Road. Tradition falls heavy on the shoulders of the braintrust at HSBC.

Mr McHowat then goes on to tell me how HSBC can provides its customers with a competitive advantage by providing them with the latest in electronic banking and security through its hexagon system.

For us ignorant laymen McHowat seems to be somewhat of an enigma, someone who wants his bank to succeed but not at the expense of either his staff or his customers.

He has that certain something those great politicians like Margaret Thatcher and Bill Clinton have: that ability to make you believe that you are very important and the center of the universe while he is talking to you. This can obviously be very persuasive in people and money management.

What type of business do you tend to attract, or try to attract? “When you have a single branch which most of the foreign banks in Thailand have had up until the recent liberalization you are restricted in the type of businesses you pursue. If you don’t have a distribution network in country, it is more difficult to raise deposits; if you don’t have a branch network, it’s more difficult to capture a broad number of retail customers. So traditionally our business has been in the wholesale market, where we have a broad range of corporate customers, and we have been offering those products and services that best suit the corporate world stretching from the largest multinationals such as Tesco Lotus and BHP to medium size local companies. At our peak we probably had close to 800 corporate relationships.

“On the retail side, we have always, of course, had a retail branch and the split in customers is fifty percent foreign and fifty percent Thai. We hope to be able to offer a standard of personal banking and products and services that is on a par with any of our international branches.

Why do foreigners in Thailand link banking with you? “We are now positioned in eighty-three countries around the world, so the appeal for non-Thais in choosing HSBC is primarily that we are a brand they recognize. An example of this is would be the mobile phone company CP Orange, which has just opened up shop in the building next to us, and we now have a number of their expatriate engineers doing their banking with us.

“And as part of a new group strategy we decided a while back that we needed to make the best of our brand and make it instantly recognizable wherever our customers are. We have made great strides in this regard over the last three years, so that now whether you are in Dubai, Vancouver, Sydney or Hong Kong you will see the HSBC and hexagon brand.

Prior to that, you would have seen a conglomerate of different names. So our brand in the Middle East was the British Bank of the Middle East (which was opened in the1940s); in the Far East it was the Hong Kong Shanghai Banking Corporation; in the UK it was the Midland Bank; and in the US, it was Marine Midland Banks Inc. But now it’s the same everywhere.

“We now have 275 multinational or joint venture companies banking with us. And part of the reason the larger foreign companies bank with us is simply because they have a history of dealing with the HSBC elsewhere. For example, HSBC Plc in the UK is the house bank for Tesco in Britain, so when that company chose to expand into Thailand and found us on their doorstep ready to provide them with similar types of services from a treasury perspective, we were obviously quite a welcome sight for them. The fact we can hook them up electronically and monitor what they’ve got here and then send that information back to their head office in the UK is also a perk for them.”

Why do Thais like banking with you? “A lot of it is just the personal touch. Many of our customers like banking with us because we have been here a long time. If you ask our Thai customers - and we frequently do - why they bank with us, they will say that we are a Thai bank in farang clothes. And I think that’s quite a compliment and says something about our history in the country. For those customers who have international payments to make, and are not inconvenienced by the fact we only have one branch, I think they are pleased by the special services we offer here.

What have you done to cater to the burgeoning number of SMEs? “We have 1700 non-borrowing accounts that are SMES. They don’t even use our facilities, so why do they use us? Many have international payments to make and they find it convenient to use a bank like ours that has an international network. Many need trade finance facilities, such as documentary credits, which our bank provides. And many just require a straightforward service, either by phone or a relationship with a bank manager.

“We have also just started a new unit we call Business Banking, and this was specifically set up to target a range of 7,000 SMEs in the Bangkok area. This is particularly related to trade and payments, the two things we are very good at. And we are finding, our one branch operation is not a limiting factor because many of these companies are e-conversant so they use our electronic banking products, through hexagon, and this allows them to make payments and transfers, pay salaries, open document credit and do almost everything they need to do from wherever they happen to be. When we do need to exchange paperwork we use various intermediaries like couriers or the post office.

What is your company doing to gain a competitive advantage? “A while ago, John Bond, the Group Chairman, began a managing for value strategy where the governing objective is to double the return to shareholders over a period of five years or specifically to `Outperform the average total shareholder return of a peer group of financial institutions with a minimum objective of doubling shareholder value over a five year period.’ What this says is we have to be better than the competition.

“Beneath the governing objective, we have eight strategic imperatives, one which particularly applies to Thailand is to align our corporate and investment banking businesses and I think over the last two years we have made great strides in doing that here. We have established a debt capital markets business, and we were mandated to raise a bond for Exim, which was named best domestic bond by FinanceAsia (??). For the IFCT, we also issued the first subordinating ___ Bond (??) These are landmark achievements in a business which we specifically focused on and put resources in, and it’s highlighted our Group’s objectives as well.”

“Why do you enjoy your job and banking so much? “I joined the HSBC’s International Management Program at seventeen and effectively what I’m committed to is a life of service overseas until I retire. I can move between any number of countries and be asked to do any number of different jobs. That in itself has proven, over the last twenty years, to be a very interesting and motivating type of career. There is never a dull moment really. You can be in markets, which are booming with businesses doing well and quickly be jettisoned into a situation where the economy is not doing so well.

“This is my first role as a CEO and I like running my own shop; I like setting strategic direction for my staff. At the end of the day, I like being accountable for the financial goals; I am proud of the progress we have made in our operations in Thailand over the last four years through we’ve been through quite a difficult period. I am particularly proud of the development of our staff. I think if you were to ask any headhunter on the market, they would say  `All roads led to HSBC.’ We are an attractive place to work and we receive a lot of unsolicited approaches from very good quality people in the market because I think they see we are doing the right things e.g. investing in businesses, which we feel have the potential to deliver growth and increase value for our shareholders.

How do you help your foreign employees adapt to life in Thailand? “Every culture offers up its challenges and nuances for a traveling ex-pat. The Thai culture is probably stronger and less corrupted than others because the country wasn’t colonized, so it probably takes a little bit longer to understand. What I have found, and what we tend to do with new foreigners starting out here is that we try to bring them up to speed very quickly in terms of immersing them in Thai culture because if we don’t they will trip over themselves time and time again and that’s not the best way to learn. So we do use people like Dr. Henry Holmes and the programs he puts together and we send members of our Thai staff along with our ex-pats to these programs. And it gives both of them an opportunity to find out how each other ticks.”

What are your motivational tools? “What I have learned is that if you are very excited about something or if you are very upset about something, try not to show either. A measured approach is very appreciated by your staff. There are ways of expressing your satisfaction or displeasure without showing strong outward signs of emotion. Newcomers may not know this and it can cost them dearly.

“And when I first arrived, I thought it was probably enough to set an example and be a good role model: put in the hours, show full commitment etc. I thought that if the boss was seen to be working hard, and then the staff would work hard too.

“But over time, I’ve realized showing a strong personal interest in your people is just as important. You must show a genuine interest in their well-being and development even if it’s something as simple as just “Morning, how are you and how’s the family?” I ask my HR department to let me know when any of our staff are seriously ill; and I have diarized the birthdays of all my senior staff as well.

What about rewarding those who work hard? “We have performance related pay based on appraisal systems, which help us make a distinction between those that are performing at the high end and those performing at the low end. This is very important in helping us assess, develop and reward our staff. Remember, we want to attract, retain and motivate the very best people.

How about dealing with confrontation? “There’s nothing like counting to ten. If something hits your desk, and you say what’s happened here, don’t just pick up the phone and immediately demand to see so and so. Take some time to figure out the problem first before reacting. Again, you must recognize that in Thailand excessive displays of emotion will steadily cause you to lose respect and face in front of your staff. The sooner people recognize that managing confrontation in that manner is wholly unproductive the better, but it does take a while.

Can you ever let down your guard? “After spending any length of time with an organization, especially if you are working within a relatively tight community, you feel you are always representing that organization, whether you are sitting at your desk or having dinner at a local restaurant. I am the CEO of HSBS and I must always be expected to uphold the standards and values people expect from the CEO of the HSBC. So it’s difficult to drop the persona in town, but if I am away on holiday, it’s a different matter.

What are your keys to success? “You have to enjoy what you do, you have to enjoy the business that you are in. But if I have learned anything in Thailand, is that there is always another day, there’s always tomorrow. Looking after your health, your state of mind, making sure you have the energy and drive to come in and face the music tomorrow means you have to take care of yourself and that doesn’t mean working till midnight every night because you won’t do yourself or your business justice if you do.

What about some advice for someone thinking of investing here? “Thailand has a stable political environment and if you want good quality, dedicated, friendly staff: welcome to Thailand. And really the country has always been a very friendly place to invest, it’s been always very easy for foreign firms to come into Thailand and they have always been made to feel most welcome when establishing a subsidiary or joint venture.

For more information please contact:

Public Affairs Department
HSBC Building, 2nd Floor
968 Rama IV Road, Silom
Bangrak, Bangkok 10500

Tel: +66 (0) 2641-4605/11
Fax: +66 (0) 2632-4830

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