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Toh Han Shih

Reuters

Share prices of global banking giant HSBC were at their lowest level in almost six weeks by midsession in Hong Kong on Tuesday following reports the bank may announce the dismissal of thousands of people next week.
HSBC’s Hong Kong share price dropped 0.74 per cent to HK$73.30, just above the session low of HK$73.25. Volume reached 7.9 million shares, with the five-day average running at 24.82 million shares.
The stock was hovering at its lowest level since since finishing at HK$70.80 on April 23.
HSBC Holdings Plc is planning to cut thousands of jobs globally and is set to make an announcement next week, Sky News reported on Monday, citing unidentified sources.
Chief Executive Stuart Gulliver will lay out these plans next week on June 9 at an investor presentation, the broadcaster said.
HSBC declined to comment. 
An estimated 10,000 to 20,000 jobs will be cut, Sky News said, citing insiders. The exact number has yet to be finalised and will be announced next week, it added.
HSBC has 257,600 employees worldwide, according to its 2014 annual report. 
Low interest rates and tougher regulations have hurt HSBC more than most other banks in recent years, meaning Gulliver has missed some of his profit and cost targets.
In response, Gulliver has sold or exited 77 business units since he took the helm just over four years ago. In February he said businesses in Turkey, Brazil, Mexico and the United States needed to improve or be sold.
HSBC is now looking to sell the Brazil business and Gulliver is expected to confirm on June 9 its loss-making Turkey business is also on the block. Substantial overhauls to HSBC’s US and Mexico businesses are also on the cards.
Sky said the job cuts to be announced on June 9 will not include the impact of any sale of the bank’s Brazil and Turkey businesses.
Less certain are Gulliver’s plans for global banking and markets (GBM), the investment banking division he ran for four years before becoming chief executive and which contributes a third of the bank’s overall profits.
Several investors and analysts say HSBC has been slower than rivals to restructure its investment bank and that Gulliver needs to cut its rates and credit business. The GBM division saw profits fall by US$1.1 billion in 2014 compared with a year earlier amid tougher market conditions for investment banks.
Gulliver is also expected to provide more details next week on whether HSBC should move its headquarters from London. If the bank moves it would most likely be to Hong Kong, where it was based before moving to London in 1993.
 
 


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HSBC

HSBC shares at lowest in 6 weeks by midday after report bank planning thousands of global job cuts 

The HSBC logo is seen lighting up the building of the lender in Hong Kong. Sky News is reporting HSBC may announce thousands of job cuts next week. Photo: EPA
 

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Update | HSBC shares at lowest in 6 weeks by midday after report bank planning thousands of global job cuts