The new head of HSBC Malta has brushed aside persistent rumours of the bank’s departure from the country, saying he was hired to lead it “for the long run”.

“I could speak until I’m blue in the face but you just need to look at what we’re doing in Malta”, Geoffrey Fichte told Times of Malta in his first interview since becoming CEO of HSBC Malta in 2023.

He spent several years at the helm of the bank’s operations in Uruguay.

Fichte spoke to Times of Malta after HSBC UK announced last month it will close its Swatar call centre this year.

Although the call centre was entirely unrelated to HSBC Malta and run by a separate legal entity – “the HSBC UK call centre has nothing to do with us, they don’t provide services to us”, Fichte is quick to point out – the issue nonetheless revived questions over the bank’s future in Malta.

In 2020, the Financial Times reported that the bank was considering whether to wind down its operations in several smaller markets, including Malta. The news came just months after the bank closed eight of its branches around Malta as part of its “focus on digital banking services”.

More recently, in May last year, a Reuters report said that the bank is considering an exit from a dozen unnamed countries in Europe as it focuses on growing its business in Asia.

Fichte, however, remains adamant that Malta has nothing to worry about.

He points to the bank’s €30 million investment in its new headquarters as proof of the company’s long-term commitment. It is “HSBC’s largest investment in a headquarters anywhere in Europe and probably the largest investment of any company in Malta in its own headquarters”, he says.

What’s more, Fichte says, the bank will upgrade and replace all its ATMs over the next year, at the cost of €5 million, as well as finalising “the most ambitious collective agreement that we’ve ever signed with our workers for the following three years”.

These aren’t the actions of a bank inching towards the exit door, Fichte argues.

“I was hired with the mandate to grow and improve our bank and manage it for the long run. Our actions are ones of investing to improve the business over the long term.”

Fichte says that HSBC is “intricately connected” with the Maltese community, a responsibility that the bank does not take lightly. “We must keep in mind that HSBC has 9,000 shareholders here in Malta, so our success is Malta’s success,” he insists.

But does he blame people for thinking that there is no smoke without fire?

“Who am I to blame people,” Fichte asks, adding cryptically: “There may be people who create these rumours but I’m focused on the here and now.”

Still, Fichte stops short of denying that the bank would turn down an offer in a hypothetical scenario where a buyer comes along with an offer, saying that the bank’s position as a systemic bank that is listed on the stock market means he “cannot comment on hypotheticals and speculation”.

“What I can tell you is what we’re doing every day, which is investing and working hard to support our customers, always with a long-term view.”

HSBC remains a ‘community bank’

Fichte is equally dismissive of the suggestion that HSBC is transitioning away from retail and consumer banking in favour of investment banking.

“We’re a community bank, so we support customers and families all across Malta and Gozo and we’ll continue to do that.”

The HSBC offices in Qormi, The bank is investing €30 million in its new headquarters.

Admitting that “there are areas to improve customer service”, Fichte believes that the bank needs to balance offering more digital solutions without “losing personalised customer service”.

“We want to use digital to help our bankers provide a better service, not substitute them. There are always going to be parts of banking that are complex and require a conversation or advice”.

‘More conversations’ about sustainability

Fichte says that HSBC Malta is looking to build upon its success in 2023, a year in which it was named the country’s ‘Bank of the Year’ by The Banker, a Financial Times publication, and saw its profits soar to over €100 million, by tightening its focus on sustainability.

Sustainability, Fichte says, is “what’s going to be required in the future, so the sooner everyone gets on board, the better”.

How does he square this with Malta’s obsession with property and construction?

“Clearly, property plays a very important part in the Maltese economy,” Fichte says, drawing a comparison with Hong Kong and Singapore, where, like Malta, space is at a premium.

When it comes to financing construction projects, Fichte explains that the bank is now “having more conversations with the players in the market about sustainability”.

“What sort of environmental conditions does it have? What’s your transition to sustainability? We’re working with our customers to generate awareness around sustainability and asking them to take that into account in future projects.”

In practice, this means that the bank is imposing stricter environmental standards on borrowers as well as trying to direct families and individuals towards “investments that are sustainability-linked or meet ESG criteria or providing them with loans such as green loans”.

In April, APS CEO and Malta Bankers Association chair Marcel Cassar told Times of Malta that banks are not seeing a demand for properties in high-rise buildings. But Fichte says it is “hard to say” whether these properties are not really in demand.

Describing Maltese buyers as “conservative by nature”, Fichte argues that Malta is “a very liquid place, so not all of these projects are financed either at the company level or at the family level” and banks may not be seeing the full picture.

The same can be said for the practice of developers using cash from one property sale to finance other construction projects.

Fichte stops short of saying whether he believes this practice is widespread, simply describing it as “not a healthy practice and not one that I would recommend”.

‘War for talent’ and new industries

Although property “will continue to be an important part of HSBC’s business”, Fichte agrees with calls for Malta to shift towards a more knowledge-based economy, less dependent on human and physical resources.

“The world is a competitive place, so we always need to keep in mind that we’re competing for resources, knowledge and skills. I think Malta is well-positioned in that regard.”

Fichte says that the bank has been working closely with national authorities to support the growth of new industries, ranging from life sciences to software and videogame development.

However, he echoes the complaints of many other employers who struggle to find people with the right skills to meet their needs.

“The war for talent impacts all sectors of the economy. I hear it a lot from our customers, one of the biggest issues they face is hiring and retention. HSBC Malta is no different.”

While Fichte remains optimistic about Malta’s economic outlook, describing his initial surprise over the diversity of the country’s economy, he admits that Malta faces similar challenges to those of many other countries, from the impacts of inflation to the slow transition to a low-carbon economy.

“I think these are areas where HSBC plays a key role and we can really help our customers navigate their concerns in the future world. I’m not saying we have all the answers but we want to create awareness and support our customers”.