17 - 23 February 2000

HSBC committed to Malta for the long term

by David Kelleher

HSBC is committed to Malta for the long term, the bank's CEO, Tom Robson said yesterday. Addressing delegates at the Federation of Industry's annual conference, Mr Robson said the bank's investment was not "a 100-yard sprint" but a "a marathon".

"This is the same approach HSBC adopts in all other countries. The HSBC Group was very pleased to complete the acquisition of a majority shareholding," Mr Robson said.

His speech centred on three factors: the approaches to privatisation, observations and thoughts after the takeover; and how HSBC can contribute to the financial services sector in Malta.

Mr Robson spoke on the three approaches to privatisation and their advantages/disadvantages, namely: Initial Public Offers (IPOs), trade sales, and management and employee buy-outs.

Turning to the bank itself following the acquisition, Mr Robson said he had been impressed with the high level of education within the Bank - in excess of six per cent of the staff already held the Institute of Bankers' diploma as compared to two per cent in the United Kingdom and in excess of three per cent held a University degree as compared to one per cent in the UK.

He added that it was also very clear that the younger staff were very enthusiastic about the HSBC involvement and possible changes which will occur, although some of the older members of staff were more unsure.

Mr Robson, however, said that compared to other countries in which the bank operates "people are more status conscious and there is a reluctance to make decisions which are outside their authority levels. In addition more junior members of staff are not encouraged to take responsibility," Mr Robson said.

"It was somewhat concerning to learn that there is no proper system to evaluate the performance of staff and this is, in all probability, linked to the lack of a proper career development programme.

"There is an urgent need to introduce meritocracy and to reward against performance. To achieve this we will introduce both proper job descriptions and objectives. In addition we need a work measurement system to accurately identify how staff should be deployed," he said.

He added that communication within the Bank is poor and "one way" - downwards. "Clerical staff are not involved in change or the decision-making process and their contribution is not generally encouraged. This, of course, is not unique to organisations which are privatised but it is an issue and one which we are addressing as quickly as possible."

Customer relations was another area, he said, that was lacking in Malta and "a major task for us". The lack of proper health and safety regulations within the bank's structure was another issue of concern that was being addressed with urgency, Mr Robson said.

Role of the unions

The role of the Unions within the Bank must also be considered, he said.

"I certainly consider a strong trade union is necessary but this should not result in an employer being restricted in its efforts to run the business. There must be a balance and as I said earlier an organisation should be able to reward people differently - staff cannot all be producing the same level of performance. Meritocracy must be a part of any organisation," Mr Robson stressed.

"Based upon my initial experiences in Malta it occurs to me it would seem appropriate in order to improve the employer/employee /union relationship to have properly organised strike ballots and cooling off periods.

Opportunities

Mr Robson said the bank's key task was to ensure that customers are provided with the level of service which they deserve. "We intend to be competitive which we believe will be good for the consumer as it will both increase choice and reduce costs," Mr Robson said.

He said there is potential within Malta to develop new products using capital markets and treasury instruments for business customers and the bank will be seeking to provide appropriate levels of finance to assist them with projects both within and outside of Malta.

"Privatisation can have an impact upon jobs and, therefore, there is the need for both the government and major corporates to create new job opportunities," he said, adding that it may be necessary in Malta "for the Bank to establish a customer services centre which will handle all of the Bank's incoming telephone calls and, possibly, a centralised processing centre which could be used for work originating from both within and outside of Malta. These are two areas we will be considering during the next two years."

Mr Robson also said that there are opportunities within Malta for cooperation between the Banks in respect of ATMs, a centralised clearing system and the provision of point of sale terminals to retailers.

"Theses are areas for co-operation to reduce costs and improve customer service. I believe we must continue to look at all other suitable opportunities to co-operate if this will help the customer," Mr Robson said.