HSBC to cut 35,000 jobs worldwide as profit plunges

Dubai - The job cuts will take place over three years.

Global bank HSBC on Tuesday announced 35,000 job cuts globally after its net profit fell 53 per cent to $6 billion (Dh22 billion) in 2019.

However, impact of the job cuts in the UAE or the wider Middle East and North Africa (Mena) region was not clear as the bank didn't disclose the breakdown in its annual results. The London-headquartered bank's will boost its investment to Middle East and Asia but reduce exposure to the US and Europe.

"There is no breakdown for the regions, therefore, it's difficult to say about job cuts here. But HSBC has appointed Stephen Moss as regional chief executive for Europe, the Middle East, Latin America, and Canada," said the spokesperson.

HSBC reported net profit of $2.3 billion before tax for Mena region, an increase of nearly 50 per cent. The profit accounted for 17.4 per cent of $13.3 billion total pre-tax profit for 2019.

The bank, however, plans to increase its investment in Mena.

"We plan to accelerate investments in Asia and the Middle East and shift more resources to those regions, while continuing to strengthen our transaction banking and financing capabilities. We intend to strengthen our investment banking capabilities in Asia and the Middle East, while maintaining a global investment banking hub in London," Europe's largest bank said in its annual results statement.

Adjusted revenue was up 5.9 per cent to $55.4 billion and adjusted profit before tax was up 5 per cent to $22.2 billion, reflecting good revenue growth in retail banking and wealth management and global private banking together with improved cost control.

"The group's 2019 performance was resilient. However, parts of our business are not delivering acceptable returns. We are therefore outlining a revised plan to increase returns for investors, create the capacity for future investment, and build a platform for sustainable growth. We have already begun to implement this plan, which my management team and I are committed to executing at pace," said Noel Quinn, group CEO of HSBC.

The bank said China's coronavirus could impact its performance this year.

"Since the start of January, the coronavirus outbreak has created significant disruption for our staff, suppliers and customers, particularly in mainland China and Hong Kong. We understand the difficulties this poses and have put measures in place to support them through this challenging time," it said.

Depending on how the situation develops, there is the potential for any associated economic slowdown to impact its expected credit losses in Hong Kong and mainland China. On a longer term basis, it is also possible that the bank may see revenue reductions from lower lending and transaction volumes, and further credit losses stemming from disruption to customer supply chains," the bank said.

waheedabbas@khaleejtimes.com