Technology still a priority, in spite of losses incurred during the credit crunch
Financial services organisation HSBC will continue to invest in technology, despite total impairment losses hitting $17.2bn (£8.6bn) due to exposure from the US sub-prime mortgage crisis.
Despite the weak performance of the bank's US business, pre-tax profits totalled $24.2bn (£12.1bn) for 2007, up from $22.1bn (£11.1bn) in 2006.
Operating expenses, which included technology spending, were 16 per cent higher than in 2006.
Last year, the bank focused on investment in processing technology that allows customers to purchase products online, whilst eliminating errors caused by human intervention.
Younger customers seem to prefer automated transaction channels and reliance on traditional banking methods is still heavy, said a statement from HSBC.
"Despite widespread adoption of system-aided self-service channels by both banks and customers, the expected reduction in volumes of transactions through traditional banking has been slow to materialise," it said.
"But sophistication of products sold in direct channels and adoption rates to increase, as the use of 24-hour self-service channels, such as ATMs, internet, mobile, and voice response units becomes increasingly commonplace."
Investment in IT will remain high on the bank's priority list, said HSBC chairman Steve Green.
"Customers' use of technology dictates how they interact with us and we are increasingly employing IT to create better products which we can deliver globally at lower cost," he said.
"As we grow our direct banking business, we will create opportunities to meet more of our customers’ financial needs."
The impact of the credit crunch on HSBC's accounts is unlikely to have a knock-on effect in the group's IT strategy, said Gartner analyst Alistair Newton.
"HSBC has always been in the forefront of IT investment and has realised that the more service channels they offer, the more people are going to use them," he said.
"So the logical answer is that the bank will continue investing to reflect the needs of their customers."
Financial services organisation HSBC will continue to invest in technology, despite total impairment losses hitting $17.2bn (£8.6bn) due to exposure from the US sub-prime mortgage crisis.
Despite the weak performance of the bank's US business, pre-tax profits totalled $24.2bn (£12.1bn) for 2007, up from $22.1bn (£11.1bn) in 2006.
Operating expenses, which included technology spending, were 16 per cent higher than in 2006.
Last year, the bank focused on investment in processing technology that allows customers to purchase products online, whilst eliminating errors caused by human intervention.
Younger customers seem to prefer automated transaction channels and reliance on traditional banking methods is still heavy, said a statement from HSBC.
"Despite widespread adoption of system-aided self-service channels by both banks and customers, the expected reduction in volumes of transactions through traditional banking has been slow to materialise," it said.
"But sophistication of products sold in direct channels and adoption rates to increase, as the use of 24-hour self-service channels, such as ATMs, internet, mobile, and voice response units becomes increasingly commonplace."
Investment in IT will remain high on the bank's priority list, said HSBC chairman Steve Green.
"Customers' use of technology dictates how they interact with us and we are increasingly employing IT to create better products which we can deliver globally at lower cost," he said.
"As we grow our direct banking business, we will create opportunities to meet more of our customers’ financial needs."
The impact of the credit crunch on HSBC's accounts is unlikely to have a knock-on effect in the group's IT strategy, said Gartner analyst Alistair Newton.
"HSBC has always been in the forefront of IT investment and has realised that the more service channels they offer, the more people are going to use them," he said.
"So the logical answer is that the bank will continue investing to reflect the needs of their customers."
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