Editorial | Shareholders will gain as HSBC begins major restructuring
Banking giant’s third-quarter profits beat expectations, and CEO Georges Elhedery’s plan to streamline operations is music to the ears of investors
With its roots in Hong Kong and Shanghai, its headquarters in the UK and its vast global reach, few would question the notion that HSBC serves as a unique and powerful bridge for finance, trade and commerce between East and West.
That said, few would argue that its opaque and complex structure and sprawling and multiple business lines were not a hindrance for one the world’s largest banks. HSBC Holdings’ move to streamline and simplify its structure is therefore a wise and necessary decision.
The bank plans to restructure worldwide operations into four business lines: Hong Kong, the UK, corporate and institutional banking, and wealth and premier banking.
CEO Georges Elhedery, who took the helm from the retiring Noel Quinn in early September, said the simpler structure would benefit customers and drive future success.
Cutting back to four lines would be a feat for a bank known for a complex matrix of legacy business lines and multiple geographies described by an abundance of baffling acronyms.
As the bank pursues greater operational efficiency and growth, some lay-offs are expected. Given HSBC had 225,000 employees at the end of 2023 there appears room for synergies.
Making Hong Kong one of its four business units and a “top strategic priority” is a positive sign of its commitment to the city and region.
