08/09/2010 Author: Tony Griffiths

HSBC to open prime unit in Brazil by 2011

HSBC is planning to take its new prime services offering, which debuted in Europe earlier this year, to Latin America, with a team expected on the ground in Brazil by the middle of 2011, the division’s head has told HFMWeek.

“We have a custody proposition in Brazil already,” said Cian Burke. “So, if you look at that as a key emerging market in Latin America, we’ve got the existing capabilities that would enable us to build and roll out prime services.”

According to Burke, HSBC’s initial plan is to leverage existing services – such as the firm’s Custody Plus offering to European clients – and create prime brokerage centres in those regions that offer them. After Europe in 2010, developments are intended for Asia, the Middle East and Brazil in 2011, he said, as a strategic focus on emerging markets.

“It’s a matter of timing. It’s a very ambitious change programme to build in Europe, Asia and the Middle East and we’re still at the exploratory stage. Having people on the ground in Latin America is a 2011 plan.”

Brazil is attracting increasing interest from hedge funds with strong market returns and a burgeoning domestic industry. Morgan Stanley opened a Sao Paulo-based prime brokerage office in March.

As well as a custody offering, HSBC currently has a significant Brazil presence via its Global Banking and Markets division.