HSBC logs annualised cost savings of $2 billion
London: Asia-focussed bank HSBC Thursday said it has achieved annualised cost savings of USD 2 billion, by taking a slew of measures, including selling some of its businesses, as part of a major cost-cutting drive.
In a statement, HSBC Chief Executive Stuart Gulliver said, the bank has been able to save USD 1.3 billion from various actions it took last year and a USD 0.7 billion in the first quarter of 2012, totaling the savings to USD 2 billion.
The lender also said it expects to have annualised savings in between USD 2.5 and USD 3.5 billion by next year.
As part of its cost cutting measures, HSBC has sold 28 of its businesses resulting in transfer of 15,000 employees. The move is expected to reduce its risk weighted assets to USD 55 billion.
Besides, the bank has reduced thousands of positions worldwide in an attempt to simplify the organisation.
In May last year, HSBC had announced a target of USD 2.5-3.5 billion in annualised savings in order to boost its profitability.
Last week, HSBC reported 26 percent growth in underlying profit at USD 6.78 billion for the three-month period ended March 2012, boosted by a robust performance in emerging markets.
The UK-based lender posted a total operating income of USD 20.44 billion in the 2012 March quarter.
In the Asia Pacific region, HSBC's profit before tax (PBT) rose to USD 2.02 billion in the January-March quarter of 2012 from USD 1.63 billion in the year-ago period.
Besides, PBT surged by 21 percent in Hong Kong and 11 percent in Latin America.
HSBC's revenue rose strongly in faster-growing regions, notably in Latin America, Hong Kong and Rest of Asia-Pacific, which were up by 7 percent, 16 percent and 18 percent, respectively.