HSBC revives plan to axe 35,000 jobs, memo shows

HSBC revives plan to axe 35,000 jobs, memo shows

HSBC is resuming a massive redundancy plan it had put on ice following the outbreak of coronavirus, and will cut 35,000 jobs over the medium term, a memo seen by Reuters on Wednesday showed.

France softens lockdown rules during the outbreak of the coronavirus disease (COVID-19)
FILE PHOTO: A woman wearing a protective face mask walks past a logo of HSBC bank at the financial and business district of La Defense near Paris as France begun a gradual end to a nationwide lockdown due to the coronavirus disease (COVID-19), May 11, 2020. REUTERS/Gonzalo Fuentes

LONDON: HSBC is resuming a massive redundancy plan it had put on ice after the coronavirus outbreak, and will cut 35,000 jobs over the medium term, a memo seen by Reuters on Wednesday showed.

The bank will also maintain a freeze on almost all external recruitment, Chief Executive Noel Quinn said in the memo sent to the bank's 235,000 staff worldwide.

"We could not pause the job losses indefinitely - it was always a question of 'not if, but when'," Quinn said.

A bank spokeswoman confirmed the contents of the memo.

In March, HSBC had postponed the job cuts, part of a wider restructuring to cut costs, saying the extraordinary circumstances of the COVID-19 pandemic meant it would have been wrong to push staff out.

The bank now has to resume the programme as profits fall and economic forecasts point to a challenging time ahead, Quinn said, adding that he had asked senior executives to look at ways to cut costs in the second half of the year.

Shares of HSBC have fallen 27per cent since the start of March, with the pandemic prompting the lender to set aside US$3 billion in bad loan provisions in its first quarter earnings.

Under the restructuring plan first announced in February, HSBC said it would merge its private banking and wealth business, cut back its European equity business, and reduce its U.S. retail network, with the aim of cutting US$4.5 billion in costs.

"The reality is that the measures and the change we announced in February are even more necessary today," Quinn said.

(Reporting by Lawrence White and Sinead Cruise; Editing by Rachel Armstrong and Clarence Fernandez)

Source: Reuters

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