HSBC Reviewing Bank’s Equities Team

HSBC will be reviewing its global equities sales and trading business as it tries to slash costs under Noel Quinn, raising the chances of more job cuts.

With HSBC’s interim chief Noel Quinn looking to ax 10,000 jobs in Europe, the bank may look to sell or shut down its equities sales and trading business. Some of these headcount cuts could come from the sale of its French retail bank.

Equity desks are becoming more automated — it wouldn’t be a shock if they take more bodies out,» said an investment banker, who was quoted on Sunday. Global equities revenues were $1.2bn (£930m) last year, representing about 2 percent of group revenues.

Any job cuts implemented as part of the latest plan would come on top of 4,700 redundancies that HSBC recently announced, according to a report. The lender is struggling with thinning profits amid a challenging environment characterized by low-interest rates, trade conflicts, and Brexit uncertainty.  The bank’s global headcount stands at about 238,000.

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The planned cuts mark the lender’s most ambitious attempt to rein in costs in years, as it would result in a substantial reduction in HSBC’s current headcount. Observers also see it as a move by Quinn to make his mark on the bank, post the exit of John Flint, the previous chief.

We’ve known for years that we need to do something about our cost base, the largest component of which is people — now we are finally grasping the nettle, said two sources quoted in the Financial Times article.

There’s some very hard modeling going on. We are asking why we have so many people in Europe when we’ve got double-digit returns in parts of Asia, they added.

Despite heavy cuts, the London-based bank with a strong franchise in Asia wants to hire more than 600 staff by the end of 2022 for the business in the Asia-Pacific region, said Kevin Martin, regional head of retail banking and wealth management who was quoted in «Bloomberg».

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