Investment bank positions at HSBC are being reduced further, marking another European pullback for the banking giant.
HSBC Trims over Two Dozen Investment Banking Analyst Positions Amid Strategic Overhaul
In a move to streamline its operations and focus on growth in Asian markets, HSBC has reportedly let go of more than two dozen analysts from its investment banking division. The cuts, primarily targeting European operations, form part of a broader restructuring effort under the bank's CEO, Georges Elhedery.
Elhedery, who took over in September, has been driving the bank's efforts to increase efficiency and reduce costs. This overhaul includes the combination of commercial and investment banking units, as well as making the operations in the UK and Hong Kong standalone businesses.
One of the main reasons behind these job cuts and the strategic shift towards Asia is the bank's belief in the region's long-term potential compared to Western markets. Consequently, HSBC has been closing most of its mergers and acquisitions (M&A) and equity underwriting operations in the US, Britain, and continental Europe. The restructuring is also based on the ongoing pressures in global investment banking, where returns have been under strain, and capital deployment needs to be optimized.
The cuts have affected Europe significantly, with most of the analyst roles being eliminated in the region. Notable departures include the global head of fixed income research, Steven Major. The reorganization has also resulted in a reshuffling of senior roles and changes in leadership positions. For instance, Murat Ulgen now serves as interim head of macro strategy in addition to his role as global head of emerging markets research.
Despite these changes, HSBC maintains that research, equities sales, and trading are core to its corporate and institutional banking business globally. The bank reported a pre-tax profit of $34.1bn (£25.7bn) in 2024, showcasing its strong performance in Asian operations. While the European operations are undergoing reallocation of resources, they are expected to focus more on core services with less emphasis on higher-risk investment banking activities.
The strategic pivot by HSBC comes amid pressures on the global investment banking sector to optimize capital, with a focus on strengthening core strengths and securing long-term growth. As part of the restructuring, Elhedery aims to achieve £1.2bn of cost-cutting by the end of 2026. The bank is additionally planning to combine its macro strategy across asset classes, including foreign exchange and fixed income. Prior to this restructuring, HSBC boasted one of the biggest research divisions on Wall Street, with over 330 analysts and associates producing more than 12,000 reports a year.
- The strategic overhaul at HSBC has led to the elimination of more than two dozen analyst positions within its investment banking division, as the bank focuses on growth in Asian markets.
- As part of this restructuring effort, HSBC is closing most of its mergers and acquisitions (M&A) and equity underwriting operations in the US, Britain, and continental Europe, reflecting a belief in the long-term potential of Asian markets compared to Western markets.
- The reorganization at HSBC also includes a reshuffling of senior roles and changes in leadership positions, such as Murat Ulgen now serving as interim head of macro strategy in addition to his role as global head of emerging markets research.
