HSBC to axe 3,500 jobs from head office

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The Independent Online

HSBC embarked on a massive job-cutting programme within its core UK bank yesterday, saying 3,500 positions would go within the next two years, with most of the cull concentrated on its head office operations.

Britain's largest bank, which recorded record profits of almost £7bn earlier this year, was condemned by the finance union Unifi as "savage".

More than 1,000 of those losing their jobs will be from HSBC's UK bank head office and regional management offices. The bank employs 2,000 in its UK bank head office, with many of those people working in its new flagship building in Canary Wharf.

The move comes on top of 4,000 jobs HSBC said it would cut, replacing them with workers in India, Malaysia and China. Of the latest round of redundancies, 500 jobs will go because HSBC has set up extensive back office and processing operations in Asia, where the cost of wages is much cheaper than in the UK.

On top of the 1,100 head office redundancies, another 1,100 positions will go from HSBC's processing operations. A further 525 jobs will be lost as a result of the bank's decision to close its back office centres in Leeds, Avon and Frimley, in Surrey. A further 800 employees will be taken out of other back office operations, mainly in branches across the country.

All of the cuts will be from HSBC's retail bank in the UK, which accounts for 25 per cent of its total profits. The move marks the first major impact on the business by Michael Geoghegan, the recently appointed head of HSBC's UK bank.

As part of its announcement, the bank said it would recruit 1,000 more staff to boost the number of people working in its branches. The move reflects the intensely competitive environment of retail banking in the UK, where all of the major players are trying to woo customers on the basis of improved service as well as competitive products.

Mr Geoghegan said: "These changes will address the high ratio of staff in head office to those in direct customer contact." Last month Mr Geoghegan fired Rod Duke, the head of HSBC's UK branch network.