HSBC May Cut More Staff After Reporting Decline In Profit
HSBC reported a decline in Q3 profits early on Tuesday and as a result may have to cut more staff in its underperforming segments, according to Business Insider.
HSBC reported that adjusted profits before taxes fell 12 percent year-over-year to $5.3 billion. The bank showed strong performance in commercial banking in regions such as Hong Kong and the United Kingdom. Furthermore, retail banking also had strong results in Hong Kong despite the recent unrest in the region.
The bank's continental European business underperformed. Furthermore, its U.S. business did not even come close to its annualized return of tangible equity goal of 6 percent and reported only 1.9 percent.
As a result of the underperformance in these areas, the bank plans to allocate fewer resources to the underperforming regions and focus its capital on the regions that are generating returns. This will require the bank to restructure and adjust its costing base. Staff cuts could follow has the bank has been reducing its presence in the Middle East, North Africa, and Turkey.
HSBC reported a decline in Q3 profits due to underperforming sectors, and the bank may have to cut staff as it focuses more on regions generating higher returns.