HSBC cuts several hundred investment bank jobs
HSBC Holdings is laying off several hundred investment bankers in London, Hong Kong and elsewhere this week as part of its jobs cull to save billions of dollars.
Staff in the global banking and markets (GBM) investment bank arm were being told of the cuts this week, and some had already been told, several sources said. It is expected to affect several hundred of GBM's 20,000 staff.
Europe's biggest bank plans to axe 30,000 jobs by the end of 2013 under a revamp by Chief Executive Stuart Gulliver to cut annual costs by USD 3.5 billion. It has shed 5,000 to date, it said on Wednesday.
The bank had 296,000 staff at the end of 2010, so the cuts represent 10 percent of the workforce. That would equate to about 2,000 staff at GBM, although that could be more as investment banking revenue has been hit hard by recent euro zone turmoil, especially in credit and rates. The bank has also said it will hire in some growth areas and countries.
HSBC has pinpointed five countries and its UK headquarters for the first wave to face cuts, mostly by the end of the year. It has said 3,000 jobs would go in Hong Kong, but not detailed any more specific cuts. The other affected countries are the United States, Brazil, Canada and Mexico.
"We are not commenting on specifics but HSBC is going through an efficiency programme as described at the investor day in May. The programme is about reducing bureacracy and enhancing organisational effectiveness," a spokesman for the bank said.
Gulliver has said the cost base is "unacceptable" and wants to get expenses below 52 percent of income. He has some way to go -- costs represented 59.1 percent of underlying income in the first nine months of this year, up from 54.4 percent a year ago.