HSBC to cut 30,000 jobs worldwide
02,2011
Editor:AT0086.com| Resource:chinadaily.com.cn
FavoriteMy
Favorite
British banking group HSBC said Monday it will cut 30,000 jobs worldwide by 2013 and sell almost half its retail bank branches in the US, part of a new strategy to focus on fast-growing emerging markets.
A man walks past a branch of HSBC bank in New York, in this September 2, 2009 file picture. HSBC Holdings Plc on July 31, 2011 said it plans to shed nearly half of its underperforming US branch network, selling 195 branches to First Niagara Financial Group Inc for about $1 billion, and closing 13 others. The all-cash sale to First Niagara covers more than 40 percent of HSBC's roughly 470 US branches, including 183 in upstate New York, six in New York City suburbs and six in Connecticut. It also includes $15 billion of deposits, $2.8 billion of loans and $4.3 billion of assets under management.
LONDON -- British banking group HSBC said Monday it will cut 30,000 jobs worldwide by 2013 and sell almost half its retail bank branches in the US, part of a new strategy to focus on fast-growing emerging markets.
HSBC's shares rose as much as 5 percent as first-half pretax profits of $11.5 billion were up 3 percent on a year ago, beating the $10.9 billion average in a Reuters poll.
The bank said it had cut 5,000 jobs after restructuring operations in Latin America, the United States, Britain, France and the Middle East and that it would cut another 25,000 between now and the end of 2013.
HSBC currently employs around 296,000 people worldwide.
Humphris declined to give details of where the job cuts would be but said the group is still hiring in emerging economies such as Brazil and Mexico.
The move echoes similar announcements by other global banks, such as Credit Suisse, UBS and Goldman Sachs, who in recent weeks said they needed to trim payrolls to adjust to tougher market conditions.
As part of its restructuring, HSBC will sell 195 retail banking branches in the United States to First Niagara Bank for around $1 billion. Most of the branches to be sold are in upstate New York, while six are in Connecticut. Four more are northern Westchester County, and two in Putnam County.
The bank is still dealing with the legacy of bad loans in the US from the 2003 acquisition of consumer lender Household International Inc. The acquisition made HSBC the biggest subprime lender in the United States at the time, which resulted in billions of losses to HSBC leading up to the financial crisis of 2008.
"I am pleased with the results, which mark a first step in the right direction on what will be a long journey," New chief executive Stuart Gulliver said in a statement.
News of the bank's overhaul and its profit _ earnings per share rose to 51 cents in the first half from 38 cents a year earlier, allowing for a 12.5 percent dividend increase to 18 cents _ boosted the company's share price.
By midday in London, shares in HSBC Holdings PLC were up 4.4 percent at 619.40 pence (10.17).
Seymour Pierce analyst Bruce Packard said the pretax profit figures were about 6 per cent higher than forecast.
"These results look better than expected, underlining the attractions of HSBC's conservative balance sheet and developing markets business," he said.
Gulliver said in a statement that he expects financial markets worldwide to remain volatile this year and in 2012. He predicted growth in the US and Europe would remain sluggish, weighed down by high debt levels and government budget cuts, but that Asia-Pacific and Latin American would continue to grow.