As well as housing their money operations, bank buildings perform an essential symbolic function. When Canada’s Big Five were trying to demonstrate their concern for the aspirations of Western Canada, they stabbed the Vancouver and Calgary skies with concrete and glass towers. In Montreal, when the Imperial discovered that the Royal’s new head office was slightly higher than its own building, its chairman ordered that a TV mast be added, so that he could top his rival by a few macho feet.
That architectural metaphor of using buildings to make financial statements applies particularly to the Hongkong Bank of Canada which opened its Canadian branch Number 52 on April 2 in Montreal. The Asian-based financial giant, which took over the Bank of British Columbia late last year, is determined to become an important national bank in this country. To demonstrate that commitment, this year it will take over five floors of a spanking new headquarters building on Vancouver’s Georgia Street that will carry its name.
The Hongkong (which retains the Bank of B.C. title for branches in Alberta and the Pacific province) clearly intends to become the anchor bank for Vancouver, if and when that city becomes a genuine international financial centre. President Eugene Nesmith points out that his bank has already become a major conduit for Asian investments into North America, particularly capital fleeing Hong Kong for Canada, which has recently turned from a stream into a torrent. “We do a little prospecting in our private banking area,” he told me, “to make sure that people who are travelling this way get a chance to place their money with us. Anything that falls out of the international banking concept will certainly be an important part of our future.” Ironically, Nesmith’s parent company has used another building to make its own, highly symbolic statement. At a time when Hong Kong’s long-term future has become a highly debatable commodity, the parent company has just moved into the world’s most magnificent (and expensive) head office. Worth $786 million the headquarters building at 1 Queen’s Road Central features such luxuries as an 11-floor atrium lighted by sunscoops on the roof that reflect filtered light onto its indoor gardens.
A world-spanning money machine, the Hongkong and Shanghai Banking Corporation employs 50,000 people at 1,200 offices in 55 countries. Its clientele includes more than a third of the world’s 200 largest corporations and the number of its issued shares is a colossal 3.2 billion.
As well as monopolizing its home territory (with 474 branches), the 122-yearold bank dominates the financial landscapes of such faraway outposts as
Cyprus, Saudi Arabia, Malaysia and the United Arab Emirates. In the United States, it owns the 340-branch Marine Midland, which is that country’s 16th largest bank. In England, its interests include James Capel & Co., the City’s most prestigious stockbrokers. Until recently, the company also owned the South China Morning Post. It continues to hold Cathay Pacific Airways Limited, five insurance firms and some of the Pacific’s largest shipping fleets.
Rewards for success are high. William
Purves, the current chairman, has use of the bank’s four yachts and five official residences—one on the French Riviera, one in London, and three hideouts in Hong Kong, including the famous Peak Palace, which cost $20.3 million to build.
The Hongkong and Shanghai Banking Corporation came to Canada in 1969 with an original investment in a commercial finance company which, in July, 1981, it converted to the Hongkong Bank of Canada. But it wasn’t until its takeover of the Bank of British Columbia that it could boast of being a major player. “We acquired a bank that had lots of integrity and a functioning credit system,” says Nesmith who is due to retire this summer. “With the introduction of a big shareholder and some comfort of an adequate capital base, we now have an excellent operation. It’s a viable retail base we could not have acquired any other way.” The Hongkong Bank of Canada has experienced some serious write-downs since taking over the Bank of B.C. and has eliminated 80 jobs during the amalgamation.
A Bank of Montreal veteran, Nesmith was the man in charge of putting that institution on to Mastercard and spent four happy years in charge of its British Columbia and Yukon operations. But his desire to stay in B.C. led him to respond to the Hongkong recruiters. “We are subservient but we retain an inordinate amount of autonomy,” he says of his current incarnation. “The Canadian operations fall directly under the American division in terms of policy decisions but on a daily basis there is plenty of communication with head office—on the bank’s own satellite system.”
The Hongkong and Shanghai has not had everything its way in recent years. The slump in world shipping rates, its failure to acquire the Royal Bank of Scotland and some very bad debts as well as the accelerating trend of borrowers to use security vehicles instead of bank loans, have reduced profits. But its commitment to the colony due to be taken over by China in 1997 remains steadfast. “Shifting the bank’s domicile from the territory is not something we contemplate,” says Chairman Purves. “It’s a Hong Kong company and we can’t suddenly move it elsewhere. We’ve got a few investments here, including this building.”
This year’s move by its Canadian branch into a prestigious Vancouver edifice seems to be part of a similar philosophy.
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