HSBC implements cost cuts

British multinational investment bank HSBC is implementing cost cuts  to escape from coronavirus woes. HSBC’s twin homes of Britain and China have been particularly hard hit by the pandemic, while cuts to central bank interest rates worldwide will curb the bank’s already pressured profit and it faces a shareholder revolt in Hong Kong over dividend halts.

HSBC has cut a number of top management roles in its investment bank, a sign that Chief Executive Noel Quinn is pressing on with plans to shake up the group despite having put a wider job cut programme on hold.

CEO Quinn last month announced a temporary halt to plans for 35,000 redundancies across the bank because of the impact of the coronavirus pandemic.

Quinn, who took on the permanent CEO role in March after a lengthy audition process during which Chairman Mark Tucker courted several external candidates, faces a nightmarish task to steer Europe’s biggest bank through the crisis.

The new strategy for the bank that Quinn announced in February already needs overhauling, as the lender tries to adapt to the crashing global economy. “It’s hard to feel anything but sympathy for Noel who’s doing okay in exceptionally tough circumstances,” said Hugh Young, managing director at Aberdeen Asset Management Asia, one of HSBC’s 10 largest investors.

Quinn’s management reshuffle includes cutting the regional head roles of the Global Banking & Markets (GBM) business which houses HSBC’s investment banking activities, the memo seen by Reuters, said. As a result, Asia-Pacific head of GBM Gordon French will take a six-month sabbatical from the bank, while the Americas head Andre Brandao will stay on until the end of the year before a further announcement is made.

Reuters