OECD COUNTRY: UNITED STATEBANK: HSBCLECTURER’S NAME: NAME MATRIC NO.Aizat Syahiran B Razuan 033451Muhammad Khairul Irfan B. Muhammed Reydzal 033961Siti Nur Idayu binti Abdul Ghaffar 033472Nurul Izzati binti Md Rameli 033326Norfariza binti Ahmad 033455

HISTORY OF DEVELOPMENT

OF THE BANKING INDUSTRY

TIMELINE OF IMPORTANT DATES IN UNITED STATES

BANK OF NORTH AMERICA• 1781-1785• Chartered by the Congress of the

Confideration• Robert Morris was architect• First commercial bank in the U.S.• Helped finance Revolutionary War• Became First Bank of Pennsylvania

THE FIRST BANK OF THE UNITED STATES

• 1791-1811 (20 year charter)• Chartered in 1791• Privately held with the U.S. government

owning about 20%• Performed functions of a central bank• Charter expired in 1811

THE SECOND BANK OF THE UNITED STATES

• 1816-1836 (20 year charter)• Chartered in 1816 for twenty years• Regulated credit and the money supply at

the expense of state banks• Was weakened by opposition from President

Andrew Jackson and the withdrawal of government funds

• Died when its charter expired in 1836

FREE BANKING ERA • 1837-1863• not really free banking• similarities– complete federal deregulation– general incorporation of banks

• deviations– no interstate/intrastate branch banking– prohibition on small bank notes– bond collateral requirement

THE NATIONAL BANKING ACT OF 1864

• Enacted to stabilize the banking system• Established the office of the Comptroller of the

Currency to issue charters to national banks• Helped establish a national currency• Did not provide for ongoing monitoring and

regulation of the credit and money supply• Did not guarantee the safety of banks

THE FEDERAL RESERVE ACT OF 1913

• Real central bank for U.S.• Lender of last resort• Nationally chartered banks must join• State chartered banks may join• Imposed reserve requirement for deposits• Federal reserve notes could be reserves• Check clearing services offered

THE EMERGENCY BANKING ACT OF 1933

• Also called the Glass-Steagall Act

• Separated commercial banking from investment banking to protect assets

• Required bank holding companies to be examined by the Federal Reserve

• Established the Federal Deposit Insurance Corporation (FDIC)

THE REVOLUTION CONTINUES

• The basic structure of the banking system remains essentially as it was in 1913.

• The business of banking, with its rapid communication, its global information exchange, and its marketing focus, little resembles the banking industry of an earlier age.

BACKGROUND OFHSBC BANK IN US

HSBC GROUP• Has an international pedigree which is

unique• Named after its founding member, The Hong

Kong and Shanghai Banking Corporation Limited

• Established in 1865 in Hong Kong and Shanghai

• To finance the growing trade between China and Europe

HSBC GROUP• Inspiration behind the founding of the Bank was

Thomas Sutherland• There was considerable demand for local

banking facilities both in Hong Kong and along the China coast

• Helped to establish the Bank in March 1865. • Now, the Bank's headquarters were at 1

Queen's Road Central in Hong Kong and a branch was opened one month later in Shanghai

HSBC GROUP• Late 19th and the early 20th centuries, the Bank

established a network of agencies and branches based mainly in China and South East Asia

• Also with representation in the Indian sub-continent, Japan, Europe and North America.

• The Bank was the pioneer of modern banking practices.

• The Bank issued notes in many countries throughout the Far East.

HSBC GROUP

• During the Second World War the Bank was forced to close many branches

• Head office was temporarily moved to London

• After the war the Bank played a key role in the reconstruction of the Hong Kong economy and began to further diversify the geographical spread of the Bank.

THE MAKING OF THE MODERN HSBC GROUP

• Diversified both its business and its geographical spread through acquisitions and alliances

• It remained committed to its historical markets and played an important part in the reconstruction of Hong Kong

• Midland was founded in Birmingham and had grown through a series of mergers and amalgamations1836

• history of Mercantile Bank stretched back and the year it was founded in Bombay (now Mumbai)1853

• The British Bank of the Middle East had begun life as the Imperial Bank of Persia1889

• extended its sphere of operations and pioneered banking in the Gulf states

• had a strong identity within Indian and other Asian markets

1950• the bank completed two important purchases:

• The British Bank of the Middle East (now HSBC Bank Middle East)

• the Mercantile Bank1959

• policy of expansion by acquisition of subsidiaries with their own identities and specializations was firmly in place1970

• Midland acquired the London merchant bank of Samuel Montagu1974

• Bank concentrated on moving into those markets where it was not yet fully represented1980

• Hong Kong Bank of Canada (now HSBC Bank Canada) was established1981

• Hong Kong Bank of Australia (now HSBC Bank Australia Limited)

• Samuel Montagu has been integrated into HSBC Investment Bank

1986

• Marine Midland Bank (now HSBC Bank USA), based in New York State, became a wholly owned member of the Group

• its principal subsidiary in the United States1987

• expansion and consolidation of the various businesses of the HSBC Group. 1990

• HSBC Holdings, the parent company of the HSBC Group, was established

• its shares quoted on both the London and Hong Kong stock exchanges.

1991• Midland Bank in the UK created one of the

largest banking and financial services organizations in the world1992

• a joint venture, the Wells Fargo HSBC Trade Bank was formed in 19951995

• a new subsidiary Banco HSBC Bamerindus was established in Brazil

• the acquisition of the Roberts Group (now called HSBC Bank Argentina SA) in Argentina was completed

1997

• HSBC Holdings signed a memorandum of understanding with the Government of Korea for the acquisition of a controlling interest in Seoul Bank, one of the largest commercial banks in South Korea

1999

1994

• Marine Midland acquired Spectrum Home Mortgage, which operated in eight states

1995

• Marine acquired United Northern Federal Savings Bank, with branches in Watertown and Lowville, New York

• acquired The Hong Kong and Shanghai Banking Corporation's six New York City retail branches

1996

• Hang Seng Bank's two branches in New York City• Marine Midland acquired 11 branches from the East River Savings Bank in the New York

Metropolitan area• HSBC transferred two branches in the northwestern United States to HSBC Bank Canada

1997

• Marine completed its acquisition of First Federal Savings and Loan • had $7.2 billion in assets, 1,600 employees, 79 retail branches in New

York State and 15 mortgage origination offices in nine states

HSBC BRANCHES IN US

HSBC Bank USA, 108th Street BranchFull Service Brick and Mortar Office6402 108th StreetForest Hills, NY 11375

HSBC Bank USA, 120 Broadway BranchFull Service Brick and Mortar Office120 BroadwayNew York, NY 10271

HSBC Bank USA, 18816 Northern Boulevard BranchFull Service Brick and Mortar Office188-16 Northern BlvdFlushing, NY 11358

HSBC Bank USA, 2 Park Avenue BranchFull Service Brick and Mortar Office2 Park AvenueNew York, NY 10016

HSBC Bank USA, 21st And Fifth Avenue BranchFull Service Brick and Mortar Office145 Fifth AvenueNew York, NY 10010

HSBC Bank USA, 52nd Street BranchFull Service Brick and Mortar Office666 Fifth AvenueNew York, NY 10103

PRODUCT AND SERVICES

OF HSBC IN US

HSBC PERSONAL

BANKING• Checking Accounts• Saving Accounts• Certificates of Deposit• Credit Cards• Debit Cards• Overdraft Protection

HSBC PERSONAL

BORROWING• Home Loans• Compare HSBC Mortgages• Help for Existing Customers• Buying a home• Refinance your mortgage• Home Equity

HSBC PERSONAL

INVESTMENT• Fixed income products• Equities and ETFs• Structured products• Mutual funds

HSBC PERSONAL

RETIRING AND EDUCATION• Annuities• IRAs• Saving for Education

INSURANCE• Term life insurance• Permanent life insurance• Disability insurance

HSBC BUSINESS

BANKING• Business accounts• Business Insurance

CASH MANAGEMENT• Online banking• Collection services• Payment services• Fraud prevention

HSBC BUSINESS

FINANCE• Line of Credit• Small Business Administration Loan• HSBC MasterCard BusinessCard®• Term Loan

HSBC BUSINESS

INTERNATIONAL• International accounts• Foreign exchange• International cash management• Importing and exporting• Business traveler services