HSBC Holdings PLC is to impose a hiring and pay freeze this year as part of its drive to cut as much as US$5 billion in costs by the end of next year.
The actions were outlined in a memorandum received by employees on Friday, HSBC spokeswoman Gillian James said on Sunday in an e-mailed statement.
“This is in line with HSBC’s moves to lower operating costs,” Guotai Junan Securities Co (國泰君安) Shenzhen-based analyst Richard Cao (曹柱) said. “HSBC can’t escape from the global economic slowdown and worsening asset quality like other global banks.”
HSBC chief executive officer Stuart Gulliver in June outlined a three-year plan to pare back a sprawling global network by shutting money-losing businesses and eliminating jobs as he pushes to improve earnings amid surging compliance costs.
Other major European lenders from Credit Suisse Group AG to Deutsche Bank AG are cutting thousands of jobs as they battle to adapt to tougher regulatory demands on capital.
Shares of the lender — which announces annual results on Feb. 22 — had risen 0.4 percent in Hong Kong yesterday at 10:29am. The stock has fallen 12 percent this year.
Under its three-year plan, the London-based lender is seeking to reduce the number of full-time employees by between 22,000 and 25,000, or about 10 percent. The bank is aiming for reductions of US$4.5 billion to US$5 billion and is seeking a buyer for its Turkey business after selling operations in Brazil.
As part of its focus on more profitable markets, HSBC is reviewing its operations in Lebanon and may exit the Middle Eastern country, people with knowledge of the matter said earlier this month. The bank is closing its Indian private-banking business, people familiar with that move said in November last year.
HSBC, which is reviewing the location of its headquarters, is to provide an update on whether it will move its base to Asia on Feb. 22.
The lender is likely to stay based in London due to the vast logistics of relocating, Aberdeen Asset Management PLC chief executive officer Martin Gilbert told Bloomberg TV last month.
Aberdeen is one of the British bank’s biggest shareholders.
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