shares fell as much as 5.6% in early Tuesday trading after the bank announced plans to cut 35,000 jobs in a major overhaul.
Europe's largest investment bank by market cap looks to slash underperforming offices in the US and Europe and focus on Asia for further growth. HSBC expects to take a $6 billion charge from restructuring and a $1.2 billion charge from asset disposal costs over the next three years.BloombergThe company posted its fourth-quarter results on Tuesday alongside the overhaul plan. Quarterly revenue and pre-tax earnings landed above analyst estimates, but profits fell 33% from the year-ago quarter.
"Depending on how the situation develops, there is the potential for any associated economic slowdown to impact our expected credit losses in Hong Kong and mainland China," the bank said in its latest quarterly report. The bank is going to be "surgical and ruthless" in its plan to cut underperforming businesses, Chief Financial Officer Ewen Stevenson said in a Bloomberg TV interview. HSBC plans to combine its consumer banking and private banking divisions into a standalone platform, while also shrinking its global reporting lines to four from seven.
The latest restructuring plan is HSBC's third in a decade, and comes amid a continued search for a permanent CEO. Former chief executive John Flint left the company roughly one year after his 2018 improvement plan failed. Chairman Mark Tucker now leads the plan to cut costs and capitalize on Asian and Middle Eastern markets while also looking to fill the bank's top role.
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