HSBC Plans Major Job Cuts as Part of $15 Billion Dollar Cost Saving Strategy

HSBC, Britain’s largest bank, has unveiled an ambitious cost-cutting programme that will reduce its workforce costs by 8 per cent, targeting savings of $1.5 billion. The bank’s new chief executive, Georges Elhedery, announced these measures alongside the bank’s record annual profits of $32.3 billion for 2024.

The restructuring plan, set to unfold over two years, will predominantly impact UK operations, particularly at the bank’s head office. While specific numbers weren’t disclosed, the reduction across HSBC’s 211,000-strong workforce is expected to result in thousands of job losses.

The bank’s transformation strategy includes merging wholesale businesses and establishing independent units for its Hong Kong and UK retail banking operations. The plan also involves scaling back its underperforming investment banking division, primarily affecting operations in the City of London.

HSBC’s financial performance remains robust, with profits exceeding analyst expectations of $31.7 billion. Shareholders are set to benefit from a $2 billion share buyback programme and a quarterly dividend of 36 cents, totalling an additional $6.4 billion in returns.

The staff bonus pool saw a marginal increase to $3.8 billion, while Elhedery’s potential compensation package could reach £19.8 million if the bank’s share price rises by 50 per cent. The bank’s shares have already appreciated by approximately 40 per cent over the past year.

Alongside these financial adjustments, HSBC has revised its environmental commitments, pushing back its net-zero emissions target for operations and supply chain from 2030 to 2050, signalling a significant shift in its climate strategy amid global banking sector changes.