HSBC pauses job cuts and restructures 30 April 2020London Reporter: Maddie Saghir
Image: London Headquarters/HSBC Media Gallery
HSBC鈥檚 planned restructure that could see a loss of by 2022, has been paused during the COVID-19 disruption.
In March, the bank said it would combine its global markets and securities services (excluding issuer services) divisions as part of its restructure. The plan was announced shortly after HSBC鈥檚 review of its 2019 financial performance results.
Following the bank's latest quarterly results, which reveals that the reported revenue is down 5 percent compared to Q1 2019, the timeline for reforms has been put on hold while the bank deals with the current disruption brought on by the pandemic.
HSBC CEO Noel Quinn, says: 鈥淚 take the well-being of our people extremely seriously. We have therefore paused the vast majority of redundancies related to the transformation we announced in February to reduce the uncertainty they are facing at this difficult time.鈥�
Quinn notes that the bank would press forward with the other areas of transformation with the aim of delivering a 鈥渟tronger and leaner business that is better equipped to help our customers prosper in the recovery still to come".
Prior to the Q1 results, go-live, Colin McLean, managing director of SVM Asset management, had highlighted that HSBC鈥檚 planned job cuts are 鈥渃urrently the biggest of the major UK and European banks, but others may be forced to accelerate cost-cutting along with impairment provisioning鈥�.
Highlights from the bank鈥檚 Q1 report revealed that securities services revenue came in at $289 million for Q1, compared to $372 million for the same period last year, representing a 22 percent drop.
Commenting on HSBC鈥檚 Q1 results, Quinn, says: 鈥淭he economic impact of the COVID-19 pandemic on our customers has been the main driver of the change in our financial performance since the turn of the year.鈥�
鈥淭he resultant increase in expected credit losses in the first quarter contributed to a material fall in reported profit before tax compared with the same period last year.鈥�
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Image: London Headquarters/HSBC Media Gallery 