GC: Can you describe your career journey and how you arrived at HSBC?
JVV: “Prior to joining HSBC, I was with ABN Amro, where I was first involved in global cash management, but then was asked to become involved in a joint venture between ABN Amro and Mellon Bank for a new global custody venture. We created ABN Amro Mellon as a separate legal entity with its own banking license, which was a phenomenal experience because creating your own bank and being able to run it was the best learning experience I’ve had in my career.
“Then we got into a situation where both shareholders were involved in M&A at the same time; ABN Amro with the famous bid from the three parties (RBS, Fortis and Santander) and Mellon merging with Bank of New York. Ultimately, ABN Amro sold its share in the joint venture to BNY Mellon and ABN Amro Mellon got dissolved as a separate legal entity. It was at that point that I decided to move on, and instead looked for something in Asia. I then joined HSBC in Singapore as the CEO of the trust company and head of securities services for the country.”
GC: What were some of those lessons learned from starting your own bank?
JVV: “The first lesson I learned was that it is very complex to run a bank, because even though it was a relatively small bank and was focused on one particular business line, you still have to have the whole banking infrastructure to meet the requirements of the regulator. The complexity of running a bank is massive, and I learned that at an accelerated pace. I also learnt that the key to success is collaboration. The good thing about the joint venture was that neither side had a majority stake, which required people to collaborate. Another lesson I learnt was from one of my managers earlier in my career that hierarchy does not work at 5000 miles, i.e. being far removed from where the real is taking place and not understanding the local implications. This is also a true statement not just for how HSBC operates but for the industry as a whole. It is a very complex business covering multiple jurisdictions, multiple legal entity structures, different regulatory environments, so if you think you can drive the business from a top-down perspective I think you are really missing the point on where you create the value.”
GC: What was the view of the global custody market in Asia? Is it different from a London perspective?
JVV: “I wouldn’t say it is different. What you see is that Asia historically has had less cross-border investment because of regulation and limitations in terms of the percentage of assets that could be allocated and invested cross-border. There is a difference in timing of development of developments, but the concepts are the same. What you see with the demographics in Asia and the wealth accumulation is that more money is being put into products that require custody. Also because of the relaxation in cross-border restrictions, there are bigger outflows.”
GC: What makes for a good day in your line of work?
JVV: “A good day is when you get good client feedback, either that is winning a deal or that clients are happy with the service they are getting. What makes a good day for me is if our teams feel that they have contributed to our strategic agenda. This business is about building sustainable relationships with clients, so the question is how can you progress with your agenda to become even more relevant to them? If we can help them service their end-clients, that is something I find very satisfying.”
GC: What are the key changes you have seen across the bank?
JVV: “The ability to integrate services beyond an individual product is something the bank has worked on pretty hard, not just from a custody perspective. One of the challenges for clients investing in complex markets in the Middle East or Asia is the currency restrictions, for example. We have worked extensively with our Markets business to create solutions to integrate efficient execution in these kinds of cases as part of our custody offering. We have also leveraged our network better to our clients’ advantage. We are in 37 countries and are connected to all the local regulators, we sit on tons of knowledge and are working more on becoming a knowledge provider to clients. I believe that is one of the things that will drive this business. There is an increasing allocation of assets from the US and Europe into those complex markets so we are using our on-the-ground knowledge to provide clients with insight into what is happening in these markets and how that will impact them. This is something we are spending a lot of time on.”
GC: And if you were trapped on a desert island with only one record, what would it be?
JVV: “Try by Pink.”