MUMBAI: HSBC's decision to reduce group headcount by 50,000 — nearly 20% of its global workforce — could have implications for India, considering that some of the cuts will come from consolidation of IT and back office operations.HSBC is one of the largest multinational employers in the financial sector with 32,000 jobs in India out of its 2.66 lakh workforce.
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Sources in the bank said half of job cuts would come from Brazil and Turkey where the bank will be exiting operations which employ around 25,000. Another 8,000 jobs are set to be cut in UK — where the bank will rebrand itself to ring-fence domestic operations from international balance sheet to conserve capital. The bank chief executive Stuart Gulliver has said that he is keeping an eye on efforts to turn around the bank's operations in US and Mexico. Gulliver has also said that it would be growing its operations in China's Pearl River Delta and in Southeast Asia.
The bank has remained non-committal about its India operations where the regulator is nudging large multinational lenders to form domestic subsidiaries.
This is the second round of job cuts by HSBC in recent years. In 2011 the company had announced the decision to cut 30,000 jobs. The rationalization took place over a year and several of the downsizing happened by filling in vacancies created by attrition through redeployment of staff. The bank aims to cut costs by $4.5 billion to $5 billion by 2017-end.
A statement issued by the bank said its focus would be to capture value from the bank's global presence in a changed world. "HSBC's international network covers 90% of global trade and capital flows, providing access to the world's highest growth markets. HSBC's client revenues linked to its international business contributed approximately 40% of the group's client revenues for the year ended 31 December 2014".
"HSBC has an unrivalled global position: Access to high growth markets; a diversified universal banking model with strong funding and a low-risk profile; and strong internal capital generation with industry leading dividends. We recognise that the world has changed and we need to change with it," said Gulliver.
Source - TOI
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Sources in the bank said half of job cuts would come from Brazil and Turkey where the bank will be exiting operations which employ around 25,000. Another 8,000 jobs are set to be cut in UK — where the bank will rebrand itself to ring-fence domestic operations from international balance sheet to conserve capital. The bank chief executive Stuart Gulliver has said that he is keeping an eye on efforts to turn around the bank's operations in US and Mexico. Gulliver has also said that it would be growing its operations in China's Pearl River Delta and in Southeast Asia.
The bank has remained non-committal about its India operations where the regulator is nudging large multinational lenders to form domestic subsidiaries.
This is the second round of job cuts by HSBC in recent years. In 2011 the company had announced the decision to cut 30,000 jobs. The rationalization took place over a year and several of the downsizing happened by filling in vacancies created by attrition through redeployment of staff. The bank aims to cut costs by $4.5 billion to $5 billion by 2017-end.
A statement issued by the bank said its focus would be to capture value from the bank's global presence in a changed world. "HSBC's international network covers 90% of global trade and capital flows, providing access to the world's highest growth markets. HSBC's client revenues linked to its international business contributed approximately 40% of the group's client revenues for the year ended 31 December 2014".
"HSBC has an unrivalled global position: Access to high growth markets; a diversified universal banking model with strong funding and a low-risk profile; and strong internal capital generation with industry leading dividends. We recognise that the world has changed and we need to change with it," said Gulliver.
Source - TOI
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