Technology Hsbc Case Study

I plan to explain the actual causes that led to the Subprime Mortgage Crisis, as well as, the role shadow banking played in the whole matter before and after the total collapse of the entire financial system. Moreover, I will be discussing five economic concept issues that were included in this subprime crisis, along

Make a customer analysis and segment the market. What impact does your analysis have on the current business model of the company?

The increased pressure on mortgage lenders to be socially responsible and lend to all groups create an opportunity for banks to lend more and charge higher fees to select borrowers who they feel pose a greater risk of default (Palmer, 2015). The primary purpose of the CRA is to assist minorities and lower income individuals from neglect and discrimination. The CRA policy might have forced the banks to implement change to aid individuals who may not qualify for a home loan to be eligible. If the banks did not follow suit with the CRA policies, they might have missed opportunities, such as mergers, acquisitions, and profitability (Elbarouski, 2016). Allen (2011) concluded loose lending led to expanding homeownership in the United States, but lending to riskier borrowers led to an increase in the foreclosure

The mortgage crisis we are experiencing in the United States today is already ranking as among the most serious economic events since the Great Depression of the 1930’s. Hardly a day goes by without a story in the newspaper or on the cable news stations reporting about the increase in the number of foreclosures across the United States. The effects of this crisis have spread across all financial markets, where in the end all of us are paying a price for this home mortgage crisis. When the housing market collapsed, so did the availability of credit which our economy depends upon. The home mortgage crisis, the financial crisis and overall economic crisis all need to address by the

The most commonly known sub-prime finance crisis came into illumination when a sudden rise in home foreclosures in 2006 twirled seemingly out of control in 2007, triggering a nationwide economic crisis that went worldwide within the year. The greatest responsibility is pointed at the lenders who created such problems. It was the lenders who, at the end of the day, lend finances to citizens with poor credit and a high risk of failure to pay. When the Feds inundated the markets with growing capital

Financial institutions did little stop subprime lending, the popularity of these types of loans kept growing, and lending companies took quantity of loans over quality which added to the so called “housing bubble” (Burry, 2010). Financial institutions didn’t

Any business or company that uses Information Technology (IT) for its operation and is leveraging it for gaining competitive advantage also needs to think about other aspects of the technology. Technical advancement and innovations alone are not sufficient to make any business attractive. IT definitely plays a huge role in the highly competitive business world now than before because of the advancement in the area and various ways it can influence the rise or fall of the business.

Jaffee, D. The U.S. Subprime Mortgage Crisis: Issues Raised and Lessons Learned. [online] World Bank. Available at: http://www-wds.worldbank.org/exter

One of the social issues that the Consumer Financial Protection Bureau policy is trying to address is regulating mortgage lenders. According to Slack (2012), “The Bureau is tasked with making sure people understand the fine print that explains the risks involved in using these services, and ensuring the banks, credit unions, and other financial companies that provide them play by the rules”. There are not many people that really read and understand all parts of their mortgage paperwork. Part of the goal of the CFPB was to make the mortgage process and loan stipulations easier to understand. A possible hidden agenda could be the government trying to avoid another financial crisis

Going beyond qualifications for borrowers, the products lenders have available need to be evaluated. Adjustable rate mortgages provide a borrower with a low initial interest rate in the initial period, which is an advantage over a fixed rate loan. Disadvantages of an adjustable rate mortgage however, have become obvious over the past years. People are allowed to purchase homes that are larger and more expensive than what they could afford with a fixed rate loan. Interest rate increases may increase depending on the state of the economy, and monthly payments will most likely increase beyond the borrowers ability to pay (Bank of America). Therefore, these loans need to be evaluated in their terms and conditions regarding the borrower. With such an unstable loan, it would be smart for the lender to avoid selling these loans to high risk consumers. However, during the “hay day” (2003-2005) of sub-prime lending, these loans were often sold to consumers with FICO scores below 620 (NPR). So lenders themselves are at fault for

One of the first indications of the late 2000 financial crisis that led to downward spiral known as the “Recession” was the subprime mortgages; known as the “mortgage mess”. A few years earlier the substantial boom of the housing market led to the uprising of mortgage loans. Because interest rates were low, investors took advantage of the low rates to buy homes that they could in return ‘flip’ (reselling) and homeowners bought homes that they typically wouldn’t have been able to afford. High interest rates usually keep people from borrowing money because it limits the amount available to use for an investment. But the creation of the subprime mortgage

Although the parent company HSBC holdings was established in 1990,when “The HongKong and Shanghai Banking Corporation” Purchased Midland Bank of UK, and its headquarter moved to London from HongKong as a condition in the takeover deal in 1993.

Jay Dvivedi looked once more at the proposal in his email inbox, sighed and closed his laptop for the night. He owed his boss, Shinsei CEO Thierry Porte, a response and he knew that he would need to send it in morning. One of the heads of Shinsei’s business units had approached Porte directly with a proposal for a new, off-the-shelf customer relationship management (CRM) system for his business. He wanted to fund it and implement with his own personnel, but he needed approval from Porte. Before Porte responded he had requested input from Dvivedi. When Dvivedi discussed the idea with his team the opinion was divided. The

It is argued that in the case of the subprime crisis, transmission occurred through direct linkages (Reinhart and Rogoff 240). These direct linkages were first of all, the “nontrivial” exposure of non-US financial institutions to the US subprime mortgage market. Secondly, there were common characteristics in various countries at the start of the crisis. Two important ones being real estate bubbles in many European countries, and large current account deficits in numerous countries as varied as Bulgaria, Iceland, Ireland, Latvia, New Zealand, Spain and the United Kingdom (Reinhart and Rogoff 244). Thirdly, various countries were not only exposed to the US subprime market, but also had common lenders with US financial institutions (Reinhart and Rogoff

Approach – A detailed analysis was carried out to consider how the organisation has adopted a customer-oriented approach as their key strategy for improved business. This includes factors like increased loyalty of the customers,