HSBC lays off 120 technology staff in Hong Kong in cost-cutting plan
The retrenched staff, many of whom have worked for the bank for over a decade, were given three months’ salary as compensation.
HSBC laid off 120 staff in its technology department in Hong Kong on Monday, part of the bank’s ongoing programme for reducing its global headcount by 25,000 and slash costs.
Employees of the bank’s IT department were told that they were fired shortly after they arrived for work on Monday, according to Francis Fong Po-Kiu, honorary president of the city’s Information Technology Federation, citing an affected staff and federation member.
The retrenched staff, many of whom have worked for the bank for over a decade, were given three months’ salary as compensation, he said.
“There might be a second round of job cuts this Saturday,” Fong said without giving details, a claim that was rejected by HSBC’s spokesman Gareth Hewett.
Banks are looking to cut costs both in Hong Kong and around the world as they struggle to reach targets for profitability. Last year, HSBC said it would miss its 2017 return-on-equity target, a measure of a bank’s profitability, of 10 per cent.
The latest job cuts are part of HSBC’s ongoing cost cutting drive. This savings push, announced in 2015, set out the goal of slashing US$5 billion in costs, and cutting as many as 25 000 jobs worldwide by the end of 2017.
Last month, HSBC’s chief executive Stuart Gulliver said on an analysts’ call during its full year earnings report that the bank was now on track to achieve US$6 billion of cost savings by the end of 2017.
“HSBC has stated that it intends to find significant cost savings by the end of 2017, as part of its ongoing strategy to ensure the bank remains efficient and competitive,” Hewett said, in response to the reports of Monday’s redundancies.
Still, HSBC continues to hire, and revealed last week that it was aiming to hire a further 1,000 staff in its banking operations in the Pearl River Delta region.