HSBC lays off 120 technology staff in Hong Kong in cost-cutting plan

On a quarterly basis, HSBC Holdings reported a pre-tax loss of $858 million.

HONG KONG: HSBC laid off 120 staff in its technology department in Hong Kong on Monday, part of the bank’s ongoing programme for reducing its global headcount by 25,000 and slash costs.

Employees of the bank’s IT department were told that they were fired shortly after they arrived for work on Monday, according to Francis Fong Po-Kiu, honorary president of the city’s Information Technology Federation, citing an affected staff and federation member.

The retrenched staff, many of whom have worked for the bank for over a decade, were given three months’ salary as compensation, he said.

“There might be a second round of job cuts this Saturday,” Fong said without giving details, a claim that was rejected by HSBC’s spokesman Gareth Hewett.

Banks are looking to cut costs both in Hong Kong and around the world as they struggle to reach targets for profitability. Last year, HSBC said it would miss its 2017 return-on-equity target, a measure of a bank’s profitability, of 10%.

The latest job cuts are part of HSBC’s ongoing cost cutting drive. This savings push, announced in 2015, set out the goal of slashing US$5bil in costs, and cutting as many as 25,000 jobs worldwide by the end of 2017.

Last month, HSBC’s chief executive Stuart Gulliver said on an analysts’ call during its full year earnings report that the bank was now on track to achieve US$6 billion of cost savings by the end of 2017. - South China Morning Post