Saturday

1st Oct 2016

Big banks fire thousands in Europe, but hiring in China

  • China's booming banking sector is a magnet for European banks (Photo: dolmansaxlil)

Eight of Europe's biggest banks have announced tens of thousands of job cuts in Britain, France, Spain and Switzerland in a bid to reduce salary costs, but will keep expanding and hiring new staff in China.

Hong Kong & Shanghai Banking Corporation (HSBC), a British conglomerate which is Europe's biggest bank, on Tuesday (2 August) announced 30,000 job cuts worldwide by 2013 - about 10 percent of its staff. Most of these cuts will affect its EU and US branches, in a bid to save some €2 billion in salary costs.

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In France, where HSBC employs some 10,000 people, the bank has told 672 people to go on early retirement, Le Monde reports.

The British bank has not scaled down its expansion plans in emerging markets such as China, with some 15,000 staff to be hired in the area in the coming three years.

"China's a strategically important market, where investments and the number of employees will grow. HSBC won't slim its operations in China," Peter Wong, the bank's CEO for Asia-Pacific told reporters in a press conference in Shanghai.

More than 5,000 people have been hired in Asia in the first half of this year and the trend will continue in China, he added.

The bank will also expand its branch network in China, where it now has over 150 outlets. Wong said HSBC would seek to get as many licenses as possible from Chinese regulators to expand in the country, including for mutual funds - a market that has recently been opened up to foreign banks.

Another British bank, Barclays, has announced global staff cuts of 3,000 for this year, half of whom are being let go in Britain. The bank aims to scale its personnel down to 146,100 by the end of the year.

Lloyd's, the third big British bank to mirror the trend, plans to make some 15,000 people redundant by the end of 2014 out of its 106,000 employees. Lloyd's still depends on public subsidies to finance its activities, after being seriously hit by the financial crisis in 2008.

In Switzerland, UBS has announced it will make some redundancies to cope with the new rules for the financial sector, without giving precise figures. According to Swiss media, the tally could reach 5,000.

At the end of last week, UBS announced it has just set up a new asset management unit in China and said it will continue to expand there, however.

"China's strong economic growth has positioned the market as one of the most promising emerging markets globally and resulted in a booming domestic equity investment market," Xinyuan Ling, the chairman of UBS global asset management said in a statement.

Other personnel cuts have been made public by Credit Suisse (2,000) in Switzerland, Bankia (2,879) in Spain, where it will close down 476 branches, and Intesa Sanpaolo in Italy (3,000 cuts).

France's BNP Paribas also wants to slash 244 jobs in the mortgage sector.

New EU rules on financial products in limbo

A feud between MEPs and the EU commission is threatening to derail financial services regulation that would protect consumers from misleading investment products.

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