HSBC said to axe senior managers in strategy shift

CEO Noel Quinn’s strategy update is expected on Feb. 18. (Supplied)
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Updated 05 February 2020

HSBC said to axe senior managers in strategy shift

  • Interim CEO to present new strategy on Feb. 18

HONG KONG: HSBC is set to unveil a new round of job cuts targeting senior international managers and reduce its presence in some smaller markets as part of a wider strategy overhaul, people with knowledge of the matter told Reuters.

The changes are expected to be part of a strategy update interim Chief Executive Noel Quinn will unveil on Feb. 18 with a view to boosting the profitability of Europe’s biggest bank by assets in a tough operating environment, the people said.

Quinn’s bid to restructure HSBC comes amid slowing economic growth in its major markets, an outbreak of the fast-spreading coronavirus, Britain’s protracted withdrawal from the EU, and lower interest rates.

While it was not clear how many jobs would go, the people said the planned move would mainly hit operations in London and to a lesser extent in Asia, which contributes nearly 90 percent of the bank’s profits.

The review will look at HSBC’s presence in some Latin American markets, the sources said, a region that accounts for just 3 percent of its pre-tax profit. Apart from Mexico, its presence in other countries in the region such as Argentina is small.

HSBC declined to comment.

The bank’s target to cut costs and simplify its notoriously complicated management setup is expected to focus on slashing a large number of global managerial roles across all business units — from investment to commercial banking, the people said.

The people spoke to Reuters on the condition of anonymity as they were not authorized by the bank to speak with the media.

HSBC has global managers looking after a wide variety of functions for most of the product lines within its business divisions. Those senior managers are backed by a string of administrative and other support staff.

“More than cost-cutting, the idea is to make the structure at the top a bit leaner and give more decision-making powers to the regional managers who are closer to the clients,” said one of the people who is aware of the internal strategy discussions.

Egypt signs lucrative gas deals

Updated 46 min 18 sec ago

Egypt signs lucrative gas deals

  • Five agreements were signed during the last fiscal year

CAIRO: The Egyptian Natural Gas Holding Company (EGAS) has signed eight research and exploration agreements with investments of $934 million.

Five agreements were signed during the last fiscal year and three others during the first quarter of this fiscal year.

Minister of Petroleum and Mineral Resources Tarek El-Molla said that the integrated strategy adopted by the ministry to develop Egypt’s natural gas resources has succeeded in recording the highest rates of natural gas production in the history of the country, achieving gas self-sufficiency and resuming exports.

He said that natural gas plays a significant role in achieving economic returns, in addition to attracting new international companies to work in the field of research and exploration in Egypt.

El-Molla said a project to transform Egypt into a regional center for the handling and trade of gas and oil is being planned.

The minister stressed the importance of implementing the national project for providing natural gas to all Egyptian governorates and citizens.

Magdy Galal, EGAS head, reviewed the development of natural gas production rates during the past five years and the efforts to confront the natural decrease of wells.

He said that during the recent fiscal year, the company signed a total of five agreements. On top of the $934 million in investments, there were also signing grants worth $51 million.

He added that the company has 37 ongoing agreements, a result of a Ministry of Petroleum and Mineral Resources strategy, which attracted new investments and the entry of Exxon Mobil and Chevron in the field of research and exploration in Egypt, and an increase in investments from companies such as Shell and Total.

He said the company is finalizing six other agreements with investments of $731 million and $14 million in signing grants.