In March 1995, the assets of the Bank of Bahrain were liquidated and restructured, and the original size of 27 billion pounds was reduced to 6.7 billion pounds.

Including the Queen Elizabeth family of England, who are also applying for redemption funds, not to mention other customers.

Because, at present, the Bank of Bahrain cannot carry out business for the time being, and more work is done to liquidate the funds of customers. As long as the customer requests to retrieve the assets held in custody with the Bank of Bahrain, then the Bank of Bahrain will follow the procedure to transfer the assets or cash to the accounts of other financial institutions designated by the customer for delivery.

Of course, customers and creditors can also choose to continue to cooperate with Bank of Bahrain, but basically, only a very small number of customers have not yet applied for redemption due to poor information or other reasons.

However, there is no doubt that the size of the Bank of Bahrain is still shrinking.

At the same time, due to the shrinkage of the business, the bloated staff team has also been drastically reduced. The number of employees in the entire Bahrain Bank was originally more than 5,000 people, but in the process of bankruptcy and liquidation, more than 2,000 people will be laid off, and the layoffs will require more than 100 million pounds in compensation.

In addition, in order to make up for the previous shortfall, Hang Seng Bank needs to continue to inject funds in order for Bahrain Bank to resume normal operations.

Moreover, even if the Bank of Bahrain can resume operations, it will take at least half a year, and within half a year, there will only be expenses, but no revenue and profits.

According to conservative estimates, the cost of Hang Seng Bank to get the Bank of Bahrain back in business may exceed 1 billion pounds. Moreover, after investing 1 billion pounds, it is only the Bank of Bahrain that has suffered a lot of vitality, and the business scale can be 20% of the level of the previous Bank of Bahrain!

And, as the scale of the business has shrunk, the reduction in the size of the workforce has not been as large as the level of business contraction. Even if business resumes, it is estimated that it will be difficult to make money this year and next year. Employee compensation and operating costs alone are conservatively estimated to be a loss of £200 million a year!

Therefore, the global news media have also begun to ridicule Hang Seng Bank for jumping into the fire pit and taking over the hot potato.

The main reason why many financial institutions are reluctant to take over the Bank of Bahrain is that they feel that the investment is not proportional to the gain. Many people who are willing to take over are also offering a symbolic price of 1 pound.

Only a fool like Hang Seng Bank would have paid 225 million pounds to buy it, and after that, more money will be needed to save the Bank of Bahrain.

It is precisely because it is not economical and far less cost-effective than setting up a new bank by yourself, so there are few people in the market who are willing to take over.

But in fact, the original business of Bahrain Bank, in fact, Hang Seng is not uncommon, Hang Seng Bank only needs the financial license and brand of Bahrain Bank.

It is more difficult for Asian banks to reach customers in Europe. And if the acquisition of a company is originally very famous, even if it is temporarily difficult, it is still easier to be accepted by customers and the market by using the brand of Bahrain to develop in Europe.

……

"Dear colleagues at the Bank of Bahrain,

I'm Lin Weizhong, CEO of Hang Seng Bank, and I must have been relatively unfamiliar with me before. Again, Hang Seng is a listed bank in Hong Kong, with a market value of more than HK$300 billion, more than US$40 billion. The annual profitability is also more than $4 billion.

Six years ago, Hang Seng's market capitalization was only one-thirtieth of what it is today. That is to say, in just 6 years, we have grown 30 times, and it is not the market value of the capital market bubble, but, in 6 years, our performance has also increased nearly 30 times, and the Hang Seng Bank with a market value of 300 billion is not more expensive than the Hang Seng Bank with a market value of 10 billion, or 30 years ago, with a market value of 100 million.

It has only been 62 years since the establishment of Hang Seng Bank in 1933. However, 62 years of development and accumulation have enabled Hang Seng Bank to surpass one financial giant after another, not only more than the previous Bank of Bahrain with 27 billion pounds of assets under control. In fact, we have over £80 billion under management and it's growing rapidly.

We bought the Bank of Bahrain because we were well thought out, and it was not as simple as blindly buying a long-established bank, in fact, we were ready to do something big. If it succeeds, not only will Hang Seng Bank's scale and influence among the world's financial companies increase, but also the Bank of Bahrain will gain far higher income and status than it does now. Of course, this requires us to work together to redefine the business of Bank of Bahrain, to abandon some bad business and focus on doing something that will be more sustainable in the future and will be less risky than the previous business.

Unlike the Bank of Bahrain, which mainly serves large customers and the wealthy, with only a small number of customers, Hang Seng Bank serves 20 million customers, most of whom are not too wealthy. Even if a client only deposits £1, we will not refuse service and will not discriminate against fees, but will enjoy the lowest fees. This is very rare in Hong Kong and Europe, and many large banks will even reject small customers, deposit amounts are low, and even impose punitive fees. We are not like that, any amount of money in our bank is our customer, there is no discrimination, even if you only save 0.1 pound, we pay much more than 0.1 pound for labor and maintenance, but we will still welcome such customers.

What we pursue is not complete revenue and profit growth, but more to serve customers, serve customers well, let them experience higher quality services than other banks, get more and more customers, revenue and profit continue to grow, this is just a by-product.

In addition, Hang Seng Bank is a bank that constantly focuses on technological innovation and service innovation. For example, in 1990, we were already developing Internet banking technology, and later, it was by virtue of this technological breakthrough that we became an innovator in the field of Internet payment and transfer, from the original only less than 1 million customers, it took five years to increase the number of customers by 20 million, and an average of 4 million new customers per year. On average, we process more than 10 million bank payments and transfers every day.

If we follow the traditional banking model, even if we increase the number of employees to 100,000, we may not be able to serve so many customers. However, most of our services are completed on the Internet, without manual work, only through computers and the Internet, which provides both efficient and high-quality services, which is why the current number of employees of Hang Seng Bank is only 13,000......

Since Hang Seng Bank has enough online stores, customers are dispersed enough, and business is very frequent, providing a large amount of transaction data, we can have enough data to analyze customer risks. Every transaction, we can trace, but the staff of Hang Seng Bank, the transaction must be carried out in front of the surveillance camera, so any employee, every transaction and work, can be traced according to the time, and it is precisely for this reason that Hang Seng successfully passed this system to avoid employees from stealing. All Hang Seng employees use surveillance cameras and video recordings to avoid making mistakes, and rarely do work that is not done in front of the surveillance cameras.

As a financial institution, the Bank of Bahrain must be in line with Hang Seng in the future, and all employees and management need to work innocently under the surveillance camera, so as to conduct illegal transactions, which is better for everyone and the company! These surveillance cameras will be networked and backed up on the server, so in the future, the headquarters wants to understand the monitoring of any online store, it can be called.

In addition, all of our businesses need to be compliant, and we don't regard loopholes and restrictions as convenience. Our staff needs to be constrained and there can't be a second Lisson.

Assuming that Lisson had enough restraint and supervision at the beginning, it would be difficult for him to make such a mistake. It was precisely because of connivance that he went further and further down the wrong route.

Monitoring and compliance are just part of the equation. In the future, we will also cut down a large number of tasks that are opaque, difficult to control, and prone to mistakes by employees.

For example, the Bank of Bahrain has a lot of business that can lead to mistakes by employees, and a large number of employees are constantly speculating in the market, which is a huge mistake in itself.

In the old Bahrain Bank, there were a large number of low-tech traders, who were constantly trading in the market every day like retail investors, and a large number of traders were engaged in high-risk derivatives trading, which was the main reason for the huge losses of the Bahrain Bank.

Employees like Lisson who took the company's money and engaged in leveraged speculation were in large numbers in the previous Bahrain Bank, and basically, half of the employees were engaged in similar jobs to Lisson. In addition, the lack of risk control and supervision led to the collapse of the Bank of Bahrain in just a few years!

In fact, following the business model of the Bank of Bahrain in the past, I believe that even without Lison, similar people will appear in the future to destroy the Bank of Bahrain. No matter how large the assets of the Bank of Bahrain are, if they fall into highly leveraged speculation, they will quickly go bankrupt again......

There is a city in Asia that uses casinos as an economic expenditure, called Macau, and Macau's most successful casino owner, Stanley Ho, summed up his experience - if you want not to lose money, the only way is not to gamble!

The financial investment industry is the same, the most important thing for investors is not to lose money, and to avoid losses, and the fastest way to lose money is undoubtedly high-leverage speculation, which magnifies the multiple of risk!

10 times leverage, only need to fluctuate 10%, you will lose all the principal! 20 times leverage, then only need 5% fluctuation, you will die and have no place to die! Because, this kind of speculation with high leverage is no longer a business or investment, and there is no difference between betting in a casino at all!

It's just that you pretend to be investing, and you think that you are a veteran and familiar person in the financial industry, unlike a gambler. But in reality, a trader like Reeson speculates heavily on high leverage, which is no different from gambling. Because high leverage cannot withstand fluctuations, it is impossible to make long-term holdings like Warren Buffett and share the value investment of the company's operating results. Therefore, Hang Seng Bank has become a shareholder of the Bank of Bahrain, and in the future, we will cut all the projects in which our proprietary funds are invested in financial derivatives. We believe that the risks of these projects are more than we can bear, and we cannot gamble with our own money in the future.

In the future, the business of the Bank of Bahrain will be concentrated in the business of commercial banking, that is, deposits and loans, and most of the business forms will be completed through the Internet. At the beginning, customers need to register on-site and with their real name, but later, they can use both traditional banking services and apply for services directly on the Internet.

In addition, we will not give up the original main business of Bank of Bahrain, but gradually focus on public fund business and securities brokerage business.

The public fund business is mainly based on index funds, passive investment in the corresponding constituent stocks of index funds, and customers subscribe for fund shares, and we will charge low service fees, similar to the American Vanguard Group, which is completely based on index funds with low cost and low management costs. The model of the pioneer company, representing the mainstream of the fund industry, is an index fund with passive investment, which has low requirements for fund managers, and a large number of transactions can be automatically carried out by the program, and the scale is larger, and the profit may not be low.

In addition, it is the securities brokerage business, and securities investment is an eternal and enduring game, and even, for many people, it is a game that they are passionate about all their lives, and the loyalty of fans of various video games may not be as lasting as securities investment. After the advent of the Internet era, the brokerage business can also be completed automatically through network channels, and the number of people needed will continue to decrease, so there are also opportunities for small profits and quick turnover.

All in all, in the future, the Bank of Bahrain will be more about serving customers and investing in customers, and we will continue to update the technology and ways to serve users through the most intimate service for customers. Through the Internet, we continue to expand more customers. Internet brokers, Internet fund platforms, Internet banks, now is the Internet era, only by embracing the Internet and walking in front of other peers, so that the Bank of Bahrain can be reborn from the ashes and obtain better development prospects......"