HSBC to cut thousands of UK & US jobs after revenues fall

HSBC is set to make thousands of staff redundant and will shrink its businesses in Europe and the United States after the bank’s interim boss said that its financial performance was “not acceptable”.

Noel Quinn, who was appointed interim chief executive in August in a boardroom shake-up that involved the ousting of John Flint, the bank’s veteran boss, pledged yesterday to “remodel the organisational structure” of HSBC.

He made the comments as Europe’s biggest bank said that pre-tax profit had fallen by 18 per cent to $4.8 billion in the three months to the end of September compared with last year, sending its shares down by almost 4 per cent.

HSBC will shift capital away from the US and Europe and will redeploy it to its fast-growing operations in Asia. Job cuts are inevitable, with the details to be announced alongside annual results in February, Mr Quinn said. About 4,700 job losses have been announced previously and he refused to comment on reports that a further 10,000 jobs could go from the 238,000-strong workforce.

Mr Quinn, 57, a previous head of commercial banking who has worked at HSBC for 32 years, is in contention to take on the top job. Mark Tucker, 61, HSBC’s chairman, said in August that he would take six months to a year to find a permanent chief executive.

Another possible candidate is Ewen Stevenson, 53, who became HSBC’s chief financial officer in January. He joined from Royal Bank of Scotland, where he oversaw a restructuring programme. Other candidates could include Stephen Hester, the former RBS boss who now runs RSA, the insurance group, and Stephen Bird, who is stepping down as Citigroup’s head of consumer banking.

HSBC’s French business is under review and parts could be sold, which could lead to about 8,000 job cuts, although as Paris has been picked as HSBC’s European hub for when the UK leaves the European Union it would be unlikely to exit the country completely.

Third-quarter adjusted revenue fell by 2 per cent to $13.3 billion. The bank abandoned its target to make a return on tangible equity of more than 11 per cent next year. Its shares fell by 23p, or 3.7 per cent, to 594½p last night.

HSBC was established in Hong Kong in 1864, moving its base to Britain when it bought Midland Bank in 1992. It operates in 65 markets and makes most of its money in Asia. In Hong Kong, its biggest market, pre-tax profit rose 1 per cent to $3 billion, despite street protests that have unnerved investors.