 "HSBC plans $3.5bn cost cuts over 3 years, jobs could go")
HSBC plc, the banking behemoth, headquartered in London, is planning to cut costs worth $3.5bn over the next three years. It appears that the bank under new chief executive Stuart Gulliver is preparing itself to tap growth opportunities in fast growing markets like China and India. The new CEO is also likely to expedite the process to move focus from retail to commercial and investment banking in developed markets. This means job losses are likely, according to a report .
[caption id=“attachment_8394” align=“alignleft” width=“380” caption=“It appears, the bank is preparing to tap growth opportunities in growing markets like China and India.Goh Chai Hin/AFP Photo”]
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In a day-long strategy presentation to investors in London, the bank said that it was betting big on growth in markets like India and China. The strategic decision to focus on high growth markets comes on the back of a strong profit before tax in Asia of $11.6bn of the global total $19bn.
In contrast, HSBC has announced that it has put the US cards business under review. This means the bank could explore options to restructure for a turnaround. Logically, one would expect the bank to sell the business that reported $2.3bn loss. The overall focus of HSBC is to grow in high growth and profitable markets.
The UK-listed bank is also planning to list on the stock exchange in Shanghai.
HSBC estimates that China will account 20% of the global GDP and India will contribute 7% by 2050. India will be the third largest economy in the world after China and US with GDP of $8 trillion.