HSBC quietly laid off a number of investment bankers in Hong Kong yesterday, as Europe's biggest lender by assets continues to trim non-traditional banking businesses hit by weak demand.
People familiar with the matter told the South China Morning Post that the London-based bank had targeted a handful of middle-ranking executives in areas that the bank no longer considers a business focus.
Most of the bankers were let go with severance packages equal to at least three months' salary, said the sources, who declined to be identified because the staff cuts had not been announced. An HSBC spokesman declined to comment.
"This is the crucial reality that every bank faces," a source said. "If you or your team cannot bring in business, that means your division becomes a cost for the bank so your job will be at risk."
One of HSBC's Hong Kong-based investment bankers who is leaving the bank in this round of cuts is a team leader at the structured credit product unit, part of the bank's investment-banking business in the region.
The sources noted that jobs at the consumer and corporate banking units of HSBC, the No 1 lender in Hong Kong, are more secure and stable as the bank now wants to focus more on its traditional banking business.
HSBC announced in August last year that it would sell non-core businesses and cut 30,000 jobs, or 10 per cent of its global workforce, as part of plans to save US$3.5 billion of annual costs by the end of next year.
The latest lay-offs are separate from that global plan. The bank said in July that the Hong Kong portion of the global staff reduction had been completed.
One person said the latest cuts were considered a "housekeeping thing" before the end of the year and largely reflected weak demand in certain business lines.
Hundreds of banking jobs in Hong Kong have been cut this year at major international banks amid a sluggish global economy and weak markets.