HSBC to axe up to 10,000 more jobs as bank tries to cut costs

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails

Sign up to our free breaking news emails

Please enter a valid email address

Please enter a valid email address

SIGN UP

I would like to be emailed about offers, events and updates from The Independent. Read our privacy notice

HSBC plans to cut up to 10,000 jobs, with the axe likely to fall hardest in Europe, the Financial Times has reported.

The cuts, aimed at slashing costs, would result in a “substantial” reduction in HSBC’s workforce of around 238,000, according to two people briefed on the matter cited by the FT. The bank is questioning why it has so many people in Europe when it has double-digit returns in parts of Asia, one of the people told the newspaper.

The job cuts – on top of 4,700 redundancies announced earlier – could be unveiled when HSBC reports its third-quarter results later this month, the FT said. The previous round of cuts was announced in August, when chief executive John Flint abruptly departed after 18 months leading the bank. Interim CEO Noel Quinn started working on the new plan days after he was appointed and has been told he is a leading internal candidate for the permanent role, the FT reported.

A spokesman for HSBC declined to comment on the report.

European banks including Barclays, Deutsche Bank and Societe Generale are cutting thousands of jobs as low interest rates and a slowing economy weigh on their prospects. HSBC has long been pivoting towards Asia, where it generated almost 80 per cent of its pre-tax profit in the first half of the year.

Born as the Hongkong and Shanghai Banking Corp. in 1865, HSBC has been shifting resources to Asia, especially China, as part of a strategy initiated by former CEO Stuart Gulliver and strengthened under Flint.

HSBC has remained committed to its expansion in the region despite the US-China trade war and Hong Kong protests. The bank said last month it is sticking with plans to hire more than 600 people for its wealth business in Asia by the end of 2022, with more than half of those jobs to be added this year.

Worried about its position as the biggest foreign bank in China, HSBC launched a public relations offensive aimed at leaders in Beijing, Bloomberg reported last month. The campaign “demonstrates our commitment to grow our business in China,” the bank said at the time.

During Mr Flint’s short tenure as CEO, the bank grappled with a declining stock price and a failure to hit cost targets. In April, he started a cost review that was expected to lead to job cuts, including hundreds of investment banking positions. Shortly after Mr Flint’s ouster, Mr Quinn told senior managers he wanted “less process and more action”.

Chief financial officer Ewen Stevenson said in August that the bank’s returns from Europe were “unacceptable”, while in the US, the bank said it will miss the return target it had set for next year.

Bloomberg