HSBC Holdings Plc is set to implement a new series of job reductions starting next week, as part of its strategic overhaul directed by recently appointed CEO Georges Elhedery, according to insider information.
The upcoming job cuts will commence in Asia and are projected to extend globally over time, impacting various roles within the investment bank. Initial reductions have already begun within the markets division, with broader layoffs slated to start imminently.
These dismissals will be executed progressively over the coming weeks and months, focusing on performance metrics, eliminating redundancy, and streamlining operations. In a statement, HSBC reiterated its commitment to expanding leadership and market presence in areas offering clear competitive advantages and growth potential.
In pursuit of cost reduction, Elhedery has merged the commercial banking division with the global banking and markets unit and has withdrawn from certain underwriting and advisory activities in Europe and the Americas. Since assuming leadership in September, Elhedery has already reduced his group executive committee by approximately a third, indicating a significant restructuring effort.
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The planned reduction in senior roles is notable, with over 40% of the top 175 managers anticipated to be affected. Completion of these adjustments is expected by June, with further details to be provided during the full-year financial results announcement on February 19. Analysts predict a pre-tax profit of $31.7 billion for 2024, representing a 4.6% increase.
HSBC’s shift from equity underwriting and advisory services outside key markets has unsettled its Asian operations, prompting numerous bankers to seek opportunities elsewhere. Concerns have been raised about potential losses in cross-border M&A advisory business from Asia to Europe and the US, with challenges anticipated in maintaining competitive positions in US-based listings of Chinese firms.
During a recent townhall, Matthew Ginsburg, a veteran dealmaker, reassured Asian bankers that despite changes, the region remains a primary focus for HSBC, emphasizing the bank’s strategy of evolving into a boutique advisory with extensive financial resources.
As HSBC navigates these strategic and operational changes, its commitment to remaining a pivotal player in Asia and the Middle East is clear. The bank’s restructuring seeks to align operations with areas of strength while mitigating redundancies, ensuring its long-term competitiveness in the global market.
