HSBC Follows Deutsche Bank in Reactivating Massive Job Cuts
Europe’s largest banks are resuming plans to cut thousands of jobs after putting dismissals on hold to show support for employees affected by the coronavirus outbreak across the continent.
HSBC Holdings Plc became the latest lender to restart reductions with a plan to eliminate as many as 35,000 positions. Chief Executive Officer Noel Quinn put the plans on hold in April, just two months after announcing the initiative. Europe and the U.S. are expected to face the brunt of the cuts.
Cost savings are particularly important for European banks after years of low interest rates and unpredictable markets put pressure on revenue. Lenders on the continent accounted for more than 80% of the banking job reductions announced last year. In the U.S., Morgan Stanley and Citigroup have pledged to hold off on dismissals, though Cantor Fitzgerald is seeking to cut hundreds of positions.
Here are the other European banks that have restarted cuts:
The German lender last month became the first major bank to resume job cuts that were halted because of the pandemic. CEO Christian Sewing has vowed to slash the workforce by another 12,000 over the next 30 months, with most reductions expected in Germany. The bank recently initiated a domestic voluntary retirement program and will soon start negotiations with the workers councils about layoffs.
CEO Thomas Gottstein said in March that the Swiss bank won’t announce any job cuts because of the virus. Last month he opened the door for future reductions, saying in a newspaper interview that the bank will come out of the coronavirus crisis needing fewer employees in the medium term, though it may be unlikely to see any cuts on the scale of some of its rivals. The rise of online banking, he said, will lead to a decrease in the number of branches.
Unlike many European peers, UniCredit proceeded with its staff reduction plan even after the virus took hold. The bank in April reached an agreement with unions to cut 5,200 existing jobs in Italy through 2023. The total was less than initially planned and the lender agreed to hire about 2,600 younger workers, halving the net number of staff reductions, which will happen through attrition and voluntary retirement. Rival Intesa Sanpaolo largely completed its earlier plan to cut the workforce by about 9%.
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