Lanka branch remains mum:

HSBC to shed 50,000 jobs

HSBC, the global bank said last week that it would shed around 50,000 jobs of its nearly 250,000 workforce as it sells several under-performing businesses and cuts billions of dollars in costs.

The move is part of bank’s major strategic revamping program announced by the bank’s chief executive Stuart T. Gulliver. As part of its latest changes, the bank said it would increase its investment in Asia, where it generates over half of its earnings.

The bank has been evaluating whether to move its headquarters to Hong Kong from London and it said it would complete the review by the end of the year, a media report said.

When contacted to find out the status quo of the branch in Sri Lanka officials declined to comment on the global job cut.

Tracing its roots to Hong Kong and known as the Hong Kong and Shanghai Banking Corporation when it was founded, still has close ties to the Asia-Pacific region.

Asia accounted for 78 percent of the bank’s pre-tax profit in 2014. HSBC also faces an increasingly challenging regulatory environment in Britain and across the globe.

The bank’s shares fell about 2.4 percent last year. The bank, which has operations in 73 countries has exited dozens of under-performing businesses in recent years as it looks to cut costs and reduce risk. Among the moves announced recently, the bank said it would eliminate 22,000 to 25,000 full-time jobs, or about 10 percent of its work force, by the end of 2017.

About 8,000 of the job cuts are expected in Britain, where HSBC employs about 46,000 people. Investors did not seem impressed, and the bank’s shares were down nearly 1 percent in trading in London on Tuesday.

The bank said it would seek to cut costs by up to $5 billion annually within two years. However, it also expects to book revamping costs of $4 billion to $4.5 billion over that period, the report stated. HSBC shed about 37,000 jobs from 2011 to 2014. However its regulatory compliance charges increased.

Like many of its rivals, HSBC hopes to reduce the amount of riskier assets on its balance sheet, including cutting the size of its global banking and market business and focus on strategically important and profitable businesses.

- LF