HSBC rated average by major research groups
HSBC Asset Management (Australia) has been given an average rating by two major research houses this week, scoring a three in Morningstar’s Business and Management Strength (BMS) rating and a competent business management rating from Assirt.
Both research groups recognised the past three years as a difficult time for the fund manager’s profitably and earnings growth, as staff changes created a phase of instability. However, the arrival of HSBC Asset Management chief executive Barry Sheehan in April 2001 was deemed by the researchers to be a postive move forwards.
In Morningstar’s report, seven out of the nine researched sectors were given a neutral outlook including stability and profitability, strategic planning, product development and infrastructure resources.
Only one area, compliance, was viewed by the researcher to be strong and awarded a positive outlook.
“HSBC has excellent compliance systems, drawing on the resources of the worldwide banking organisation. All compliance plans and governing procedures are well-documented,” the report says.
The group’s administration and client services division was the most harshly rated, with a weak and negative outlook given. Morningstar says while HSBC’s processing times are efficient they are below industry best practice, and its web site lacks interactivity and has no transactional capability. The absence of an adviser web site also attributed to Morningstar’s rating of the fund manager.
As well as rating HSBC’s business management as competent, Assirt also rated the group’s Asset Allocation, Australian Equities, International Equities and Australian Fixed Interest as competent.
Assirt has viewed the recent senior appointments as effective in strengthening the executive team, including head of retail Rick Villars, and the group’s focus on growth strategy.
The expanded Australian equities team was also viewed as positive.
“Since the last review the Australian equity team has been increased in size and experience. This has enabled the managers to improve the depth and quality of bottom-up equity research,” Assirt says.
At a funds level, Assirt awarded the Active Growth, Strategic Property, Property Securities four stars while all other funds were given three.
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