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HSBC to slash 4,000 more British jobs in favor of Asia

"We will fight tooth and nail to get the bank to reconsider its actions."

Rob O'Neill, an official with the UNIFI union

HSBC Holdings Plc, the world's second-biggest bank by market value, faces trade union opposition to plans to eliminate 4,000 more jobs in the UK as it shifts work to lower-cost sites in Asia.

"We will fight tooth and nail to get the bank to reconsider its actions," Rob O'Neill, an official with the UNIFI union, said in a statement yesterday. London-based HSBC plans to move call-center and back-office jobs to China, Malaysia and India.

HSBC joins JP Morgan Chase & Co, Morgan Stanley and other financial companies in moving some operations to Asia and India to avoid paying London or New York wages and office rents. The lender is cutting costs after more than US$45 billion in purchases in the past five years.

"This is the flip side of globalization," said Winson Fong, who helps manages US$2 billion at SG Asset Management Ltd. in Singapore, including Asian bank stocks. He doesn't own HSBC. "The bigger the company, the more they need to look for ways to cut costs."

Chairman Sir John Bond has been buying financial companies including Household International Inc and Lloyds TSB Group Plc's Brazil units in an attempt to overtake Citigroup Inc, the world's biggest bank. New York-based Citigroup's market value is still 60 percent higher than HSBC's ?91.8 billion (US$154 billion).

The bank has said it wants to cut UK staff to save on pension payments and taxes.

Salaries in India are between one-tenth and one-quarter of what would be paid in London, New York or Hong Kong, according to the Indian Institute of Management in Bangalore.

"As one of the world's largest financial services companies HSBC has a responsibility to all its stakeholders to remain efficient and competitive," Bill Dalton, chief executive officer of the bank's UK consumer unit, said in a statement.

HSBC opened its first processing center in Guangzhou, China, in 1996 and started moving back-office employees to India in 2000.

The world's top 100 financial companies will move 1 million back-office and technology-related jobs to India by 2008, Deloitte Research forecast in an April report. That's half the 2 million positions, or about 15 percent of financial jobs worldwide, that will probably be moved offshore by then, the report said.

Most of the 4,000 job cuts will be in Sheffield, Birmingham and Brentwood in England and Swansea in Wales. HSBC will begin transferring the work to Asia and India in January and said it will probably have to fire some workers.

"We can't rule out compulsory redundancies," said Karen Ng, a spokeswoman for HSBC.
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