International banking and financial services organisation HSBC has revealed that it has started a restructure of its business in UK , and in the rest of the world. HSBC focuses on offering loans to medium sized and smaller scaled business, amongst other financial services.
The entity states that it will cut close to 300 jobs in the UK, and around 35 000 staff globally, making this a serious reformation to its services. Furthermore, the bank is forced to:
- merge its wealth business with its banking unit
- cut back on its European equity business
- reduce retail network in the United States
All this change is a part of a ongoing restructuring program that was announced by HSBC earlier this year. The main reason for this dramatic action is to reduce the bank’s cost of operations. Just as an example, August saw an official HSBC warning claiming that its loan losses for 2020 could reach $13 billion.
The proposal for this reform was cemented in June after being proposed in February. The bank acted as fast as it did because of the ongoing economic crisis caused by the pandemic. Furthermore, a negative economic forecast for Asian countries is another reason for this.
Recently, another major player in the banking sector, Danske Bank, is planing to lay off a portion of its workforce.