HSBC resumes 35,000 job cut scheme after Pandemic Pause

HSBC is resuming plans to cut about 35,000 jobs

HSBC has resumed plans to cut about 35,000 jobs, putting it on ice after the coronovirus outbreak, as Europe’s largest bank impacts its already falling profits. Chief Executive Noel Quinn said in a memo sent to HSBC’s 235,000 employees worldwide on Wednesday and that Reuters said it would maintain a freeze on almost all external hiring. Quinn said, “We can’t hold down job losses indefinitely – it was always a question of ‘not if but when'”.

An HSBC spokesman confirmed the contents of the memorandum.

HSBC had postponed the job cuts, part of a broader restructuring to cut costs by $ 4.5 billion, saying in March that extraordinary circumstances meant it would be wrong to lay off employees.

However, Quinn said it would now have to restart the program as a decline in profits and an economic forecast for the challenging times ahead indicated that it had asked senior executives to cut costs more in the second half of 2020 Told to look at ways.

The Global Banking and Markets (GBM) is expected to have a large number of job cuts in the back office, which is part of HSBC’s Investment Banking and Trading.

The cut will also affect senior UK bankers who work at GBM and HSBC’s head office, as well as support staff in their businesses around the world.

The executive said that HSBC expects it to be natural to play 25,000 roles every year, but re-employing all affected employees would be unrealistic.

WIDER WOES

According to the executive, whether or not HSBC can pay in the future is unlikely to affect the timing of resumption of job cuts or the size of dividends. more.

Analysts said HSBC’s move is a sign of widespread cuts in the sector as banks face a harsh operating environment.

“It was only a matter of time before announcing cost-trimming plans over time,” said analyst John Cronin of Goodbody, a Dublin-based broker.

HSBC shares have fallen 27 percent since the beginning of March, with the epidemic indicating a separation of $ 3 billion in bad debt provisions in its first-quarter earnings.

As part of the initial plan, HSBC said it would merge its private banking and wealth business, withdraw its European equity business and reduce its US retail network.

HSBC shares rose 1 per cent in London, under legalists on both sides of the Atlantic, for support for a new security law in Hong Kong.

(This story is not edited by NDTV employees and auto-generated from a syndicated feed.)

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