HSBC to combine markets and securities services as part of restructure
06 March 2020 London
Image: Shutterstock
HSBC is set to combine its global markets and securities services (excluding issuer services) divisions, which is due to be complete in May.
As part of the restructure, co-heads of securities services Allegra Berman and Richard Godfrey will report to Greg Guyett, co-head of GBM for an interim period only.
Upon completion in May, the combination of securities services and global markets will be formed into a new unit named 鈥榤arkets and securities services鈥�.
From this point, Berman and Godfrey will report to Georges Elhedery and take on newly expanded positions in addition to their current roles.
Berman will become head of institutional sales for markets and securities services, while Godfrey will lead a new product area, named securities financing.
He will do this alongside Hossein Zaimi, global head of equities, which will comprise of equity prime financing, rates and credit repo activities and collateral treasury.
The restructure will also see derivatives clearing services will move under securities services, and Najib Lamhaouar, global head of over-the-counter clearing and exchange-traded derivatives, will report to Berman and Godfrey, and join the securities services executive committee.
Issuer services will remain a private side activity and become part of capital markets to align with other issuer client activities.
Under the issuer services division, Giovanni Fenocchi, head of issuer services, will report to Alexi Chan and Ray Doody, co-heads of capital markets, effective in Q2 following completion of 鈥渁ll necessary due diligence鈥�.
In a joint memo, Guyett and Elhedery, said: 鈥淭his combined entity will provide a number of significant opportunities, including enhancing our institutional client relationships and expanding our prime financing business.鈥�
Additionally, a joint statement from Berman and Godfrey stated: 鈥淲e are delighted and excited to be brought together with global markets in the creation of the new markets and securities services unit. Recognising increasing client demand for comprehensive and seamless solutions and services, this alignment of products and capabilities under one umbrella will help improve the client experience and better position us to capture increased market share and client revenue growth.鈥�
鈥淭his unit will enable global banking and markets to focus on supporting our institutional clients across the entire investment value chain 鈥� from research, market analysis, financing and execution to investor servicing, valuation, reporting, custody and clearing.鈥�
Discussing issuer services, it was outlined in the statement that 鈥渢he issuer services business is ideally positioned to provide solutions for both client groups and by putting this business alongside the origination teams in global banking, it will only help increase client cross-product and cross-business referrals, which is the key for growing our revenues in this client sector鈥�.
Berman and Godfrey added: 鈥淎ligning issuer services with global banking, and securities services with global markets will create a clear separation between the private and public side divisions of global banking and markets respectively.鈥�
The recent plans to change the structure follows the announcement by HSBC鈥檚 group executive, Noel Quinn, who indicated that HSBC will as well as factors relating to the economic environment.
As part of its 2019 results, the bank revealed it could face 35,000 job cuts by 2022, taking the headcount from 235,000 closer to 200,000.
At the time of the announcement, Quinn said: 鈥淲e have already begun to implement this plan, which my management team and I are committed to executing at pace.鈥�
As part of the restructure, co-heads of securities services Allegra Berman and Richard Godfrey will report to Greg Guyett, co-head of GBM for an interim period only.
Upon completion in May, the combination of securities services and global markets will be formed into a new unit named 鈥榤arkets and securities services鈥�.
From this point, Berman and Godfrey will report to Georges Elhedery and take on newly expanded positions in addition to their current roles.
Berman will become head of institutional sales for markets and securities services, while Godfrey will lead a new product area, named securities financing.
He will do this alongside Hossein Zaimi, global head of equities, which will comprise of equity prime financing, rates and credit repo activities and collateral treasury.
The restructure will also see derivatives clearing services will move under securities services, and Najib Lamhaouar, global head of over-the-counter clearing and exchange-traded derivatives, will report to Berman and Godfrey, and join the securities services executive committee.
Issuer services will remain a private side activity and become part of capital markets to align with other issuer client activities.
Under the issuer services division, Giovanni Fenocchi, head of issuer services, will report to Alexi Chan and Ray Doody, co-heads of capital markets, effective in Q2 following completion of 鈥渁ll necessary due diligence鈥�.
In a joint memo, Guyett and Elhedery, said: 鈥淭his combined entity will provide a number of significant opportunities, including enhancing our institutional client relationships and expanding our prime financing business.鈥�
Additionally, a joint statement from Berman and Godfrey stated: 鈥淲e are delighted and excited to be brought together with global markets in the creation of the new markets and securities services unit. Recognising increasing client demand for comprehensive and seamless solutions and services, this alignment of products and capabilities under one umbrella will help improve the client experience and better position us to capture increased market share and client revenue growth.鈥�
鈥淭his unit will enable global banking and markets to focus on supporting our institutional clients across the entire investment value chain 鈥� from research, market analysis, financing and execution to investor servicing, valuation, reporting, custody and clearing.鈥�
Discussing issuer services, it was outlined in the statement that 鈥渢he issuer services business is ideally positioned to provide solutions for both client groups and by putting this business alongside the origination teams in global banking, it will only help increase client cross-product and cross-business referrals, which is the key for growing our revenues in this client sector鈥�.
Berman and Godfrey added: 鈥淎ligning issuer services with global banking, and securities services with global markets will create a clear separation between the private and public side divisions of global banking and markets respectively.鈥�
The recent plans to change the structure follows the announcement by HSBC鈥檚 group executive, Noel Quinn, who indicated that HSBC will as well as factors relating to the economic environment.
As part of its 2019 results, the bank revealed it could face 35,000 job cuts by 2022, taking the headcount from 235,000 closer to 200,000.
At the time of the announcement, Quinn said: 鈥淲e have already begun to implement this plan, which my management team and I are committed to executing at pace.鈥�
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