HSBC to axe 1,100 jobs worldwide
Updated: 2008-09-27 07:26
By Lillian Liu(HK Edition)
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A protester stands outside the HSBC headquarters during a demonstration in Hong Kong on Friday. AP |
Europe's largest banking group HSBC Holdings PLC will axe 1,100 jobs worldwide, including 100 in Hong Kong, on concerns of profit earnings decline due to the global financial upheaval.
Peter Wong, the banking group's executive director for Hong Kong and Chinese mainland, also did not rule out the possibility of more layoffs.
"The financial environment is difficult now. It's nothing extraordinary that some staff have to leave our operations. I think similar action will continue to come in the financial sector," Wong said.
The reductions, mainly in the global banking and market division, amount to about 4 percent of HSBC's wholesale banking workforce, a Hong Kong-based corporate communications manager at the bank said in a phone interview.
She said the Hong Kong staff to be laid off are contractors and temporary workers.
HSBC is adding to about 120,000 financial jobs already lost worldwide since the global credit crisis began just over a year ago, which also led to more than $520 billion in write-downs and credit losses.
About half of the job reductions will be in the United Kingdom. Some 450 staff working under contracts will be affected. HSBC employs about 335,000 people around the world.
The lender said it had opted to reduce its workforce because of the current global economic turmoil and the cautious outlook for 2009. "Markets continue to be challenging and difficult but our strategy leaves us well positioned for the next wave of global growth, when it comes," Gareth Hewett, the bank's Hong Kong-based spokesman said.
Last month, HSBC said its half-year profits fell 28 percent to $10.2 billion, as it was forced to write off $14 billion from bad debts in the US and asset write-downs. Its pre-tax profits fell 35 percent to $2.1 billion during the same period.
In comparison, HSBC's home competitor Standard Chartered Bank (SCB) said earlier it would increase its frontline sales staff by 50 percent at its consumer banking unit in Hong Kong to cope with growing local business needs.
Peter Sands, group chief executive of the firm, said on Sept 12 that SCB would hire professionals from other banking institutions in Hong Kong.
The city was the biggest contributor to the bank in the first half, said Benjamin Hung, chief executive for the bank's Hong Kong operation. SCB's income from consumer banking rose to HK$628 million, up 15 percent from last year.
London-based SCB remained unaffected as many other British banks suffered losses from US credit crunch and the lender posted 31 percent year-on-year profit growth for the first half of 2008, thanks to robust economy in major markets in Asia and Middle East.
He Guangbei, chief executive of Bank of China (Hong Kong), said the current investment and business operating environment as well as the global economic downturn are not favorable for wholesale banking.
As a result, retail banking will feel the pinch, He said on the sidelines of a Hong Kong Association of Banks meeting on Friday.
(HK Edition 09/27/2008 page2)