HSBC Holdings may slash as many as 10,000 jobs as part of a cost-cutting drive, that signalled Europe may bear the brunt of the initiative, reported Bloomberg.
The plan would result in a substantial reduction in HSBC’s workforce of about 238,000. The bank, one of several European lenders eliminating roles, is questioning why it has so many people in the region when it has double-digit returns in parts of Asia.
The job cuts—on top of 4,700 redundancies flagged earlier—could be unveiled when HSBC reports its third-quarter results later this month. The previous round was announced in August 2019, when Chief Executive Officer 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.
HSBC has long been pivoting toward Asia, where it generated almost 80 per cent of its pretax profit in the first half of the year.
During Flint’s short tenure as CEO, the bank grappled with a declining stock price and a failure to hit cost targets. In April 2019, Flint started a cost review that was expected to lead to job cuts, including hundreds of investment banking positions.
Chief Financial Officer Ewen Stevenson said in August 2019 that the bank’s returns from Europe were ‘unacceptable,’ while in the US, the bank said it would miss the return target it had set for next year.
Established as the Hongkong and Shanghai Banking Corporation 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, even with the US-China trade war and Hong Kong’s protests swirling. The bank said last month it’s sticking with plans to hire more than 600 for its wealth business in Asia by the end of 2022, with more than half of those jobs to be added through this year.