Kirsty Wigglesworth/AP/File
A taxi is reflected as it drives past an HSBC plaque in St James's Street in London, Tuesday, June 9, 2015. HSBC Holdings, Britain's largest bank by market value, will cut between 22,000 and 25,000 jobs around the world in an attempt to reduce costs and shift its centre of gravity back towards fast-growing Asian economies.

HSBC cuts up to 50,000 jobs as focus shifts to Asia

HSBC, Europe's largest bank, wants to shift its center of gravity further toward the fast-growing Asian economies where it started operations 150 years ago. The bank, which has operations in over 70 countries and around 51 million customers, said it intends to sell its operations in Turkey and Brazil.

HSBC Holdings, Europe's largest bank by market value, will cut up to 25,000 jobs globally to reduce costs and shift its center of gravity further toward the fast-growing Asian economies where it started operations 150 years ago.

The bank, which is based in London and has a value of around 120 billion pounds ($184 billion), said Tuesday it is "undertaking a significant reshaping of its business portfolio" and "redeploying resources to capture expected future growth opportunities."

Though it has not yet decided whether to move its headquarters, the bank's statement shows clearly where it thinks its commercial future lies — China and the Asia-Pacific region.

HSBC already has a major presence across Asia. Around 75 percent of its 2014 profits were generated in the region, even though it only has about a third of its staff there and its assets are dwarfed by those it controls in Europe.

HSBC has historic ties to the region. It was founded in Hong Kong in 1865 when the city was a British colony in order to finance growing trade between China and Europe, much of it involving opium. Its original name, later shortened to HSBC, says it all: The Hongkong and Shanghai Banking Corporation.

"The world is increasingly connected, with Asia expected to show high growth and become the center of global trade over the next decade," said Stuart Gulliver, HSBC's chief executive. "We recognize that the world has changed and we need to change with it."

HSBC, which has operations in over 70 countries and around 51 million customers, said it intends to sell its operations in Turkey and Brazil, a move that will see its workforce reduce by around another 25,000. Although planning to dispose of its operation in Brazil, HSBC said it plans to maintain a presence in that country to serve large corporate clients in their international dealings.

Overall, HSBC aims to cut costs by $4.5 billion to $5.0 billion by the end of 2017 and reduce the number of full-time employees by around 10 percent, equivalent to between 22,000 and 25,000.

About 8,000 of those lost jobs will be in Britain. The bank hopes many will come from attrition, by not filling posts that are vacated.

A top union official in Britain said the expected job cuts represented the latest example of a workforce being punished for the misconduct of others, notably those in senior management and investment banking. HSBC has paid billions in fines globally to settle investigations of market rigging and allegations it helped clients evade taxes and launder money.

"After all the scandals of recent years, front-line staff have suffered time and time again as they are forced to pay for the mistakes of others with their jobs, their terms and conditions and their reputation," said Dominic Hook of Unite union.

A further concern for British staff is the possibility that the bank will move its headquarters out of London. The bank said it will make the decision this year.

The bank has already warned about the economic risks facing Britain if the country opts to leave the European Union in a referendum that the government has said will take place by the end of 2017. It's also complained about the cost of a levy that the British government puts on banks — HSBC is set to pay around $1.5 billion this year alone on that.

HSBC's announcement comes a day ahead of a major speech from British economy minister, George Osborne, who many think is considering pulling back the bank levy.

"We think the financial logic for HSBC to escape the clutches of the U.K. — and Europe — is overwhelming," said Ian Gordon, an analyst at Investec. "What possible reason is there to stay?"

HSBC's plans to accelerate its investments in Asia will involve the expansion of the asset management and insurance businesses in a bid to earn more profits from the region's rapidly expanding class of newly wealthy.

In particular, the bank is planning to develop business in southern China's Pearl River Delta manufacturing heartland in Guangdong province, which is next door to Hong Kong and one of the wealthiest regions in the world's No. 2 economy. It's also planning a similar expansion in Southeast Asia, where booming economic growth in countries like Indonesia is swelling the ranks of the middle classes.

HSBC added that it wanted to return to profitability the global banking and markets division, a branch that has been hit by tougher regulations since the financial crisis. In 2014, HSBC saw its post-tax profit fall to $14.7 billion from $17.8 billion the year before, largely because of a series of fines, settlements and customer compensations in Britain.

Investors appeared lukewarm to HSBC's strategic plan as much of it had been anticipated. The company's share price was down 1.1 percent at 613 pence in late morning trading in London.

You've read  of  free articles. Subscribe to continue.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to

QR Code to HSBC cuts up to 50,000 jobs as focus shifts to Asia
Read this article in
QR Code to Subscription page
Start your subscription today