HSBC is preparing to scale back sections of its investment banking operations across the 海角视频, Europe and North America as part of a comprehensive global restructuring strategy under new CEO Georges Elhedery.
This development follows the bank's announcement last year of plans to achieve $3bn (£2.4bn) in cost savings and restructure into four new divisions, divided between East and West, as reported by .
"We will retain more focused M&A and equity capital markets capabilities in Asia and the Middle East, and we will look to wind-down those activities in Europe, the 海角视频 and the Americas," an HSBC spokesperson informed City AM.
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The company aims to transition to a "Our intention is to move to a more competitive, scalable, financing-led model," according to a memo sent to staff and seen by Reuters.
In the internal communication, management acknowledged that the changes would be disruptive for those involved in dealmaking and corporate capital raising in the affected regions.
"As part of our ongoing efforts to simplify HSBC and increase leadership in our areas of strength, we are finalising a review of our Investment Banking business," the spokesperson further added.
The news has led to a 0.7 per cent drop in HSBC’s share price. Elhedery’s streamlining plan for HSBC has already resulted in numerous senior bankers being laid off, with predictions that over 40 per cent of HSBC’s top 175 managers will be let go.
HSBC has witnessed a series of departures from its senior executive team, including Annabel Spring, the head of global private banking and wealth; Celine Herweijer, the group sustainability officer; Stephen Moss, the Middle East chief; and European leaders Colin Bell and Nuno Matos. The bank's new CEO, Elhedery, who took over from Noel Quinn four months ago, has swiftly initiated significant changes at the banking behemoth with an aim to curb expenses and streamline operations.
A mere two months into his tenure, hundreds of managers were asked to reapply for their positions as HSBC started to consolidate its corporate and investment banking divisions. This move comes as banks are seeking to cut costs in response to interest rate reductions that are starting to erode profit margins after a period of unprecedented earnings.