HSBC to freeze salaries, hir­ing to cut costs

The Pak Banker - - FRONT PAGE -

Europe's largest len­der, HSBC, is im­pos­ing a hir­ing and pay freeze across the bank glob­ally in 2016, two sources fa­mil­iar with the mat­ter told me­dia. An email was sent to staff de­tail­ing the lat­est cost-sav­ing mea­sures, ac­cord­ing to the sources who spoke on con­di­tion of anonymity.

Like nu­mer­ous other global banks, HSBC is in the midst of a cost-cut­ting drive to boost prof­itabil­ity and re­turns to share­hold­ers, and is push­ing through with plans for an­nual cost sav­ings of up to $5 bil­lion by 2017.

Europe's big­gest bank said in June that it planned to slash nearly one in five jobs and shrink its in­vest­ment bank by a third in re­sponse to slug­gish eco­nomic growth and tighter global regulation of bank bal­ance sheet risk. "As flagged in our In­vestor Up­date we have tar­geted sig­nif­i­cant cost re­duc­tions by the end of 2017," a spokes­woman for HSBC told Reuters, con­firm­ing the con­tent of the staff email.

In Oc­to­ber, con­trac­tors at its in­vest­ment bank­ing divi­sion in Lon­don had their pay cut by 10 per­cent in line with the bank's ef­forts to rein in costs, a source fa­mil­iar with the mat­ter said.

News of the pay and hir­ing freeze fol­lows a sig­nif­i­cant week for HSBC, af­ter its board met last week to con­sider mov­ing head­quar­ters to Hong Kong and to fo­cus on the bank's strat­egy. A de­ci­sion on the domi­cile is­sue could come early next week, a se­nior source at the bank told Reuters on Jan. 27.

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