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HSBC cuts UK investment bankers as layoffs accelerate

HSBC has cut frontline staff at its UK investment bank as a dealing crisis this year is expected to lead to another round of layoffs across the industry.

The British lender, which is in the midst of an ongoing cost-cutting exercise unveiled in February 2020, has cut a handful of roles at its global banking unit in London in recent weeks, according to people familiar with the matter.

The cuts extend from vice president to general manager, they added.

A spokesperson for HSBC declined to comment.

HSBC set a cost reduction target of between $5 billion and $5.5 billion when it released its 2021 annual results. Its global banking and markets unit was also the target of an overhaul in 2020 aimed at reducing costs, which should ultimately result in a reduction in the workforce of approximately 35,000 people.

Despite ongoing cost-cutting targets, HSBC has so far limited job cuts to support functions and relied on staff attrition rather than layoffs where possible.

LILY HSBC appoints new private markets trading team

The UK remains a strategic market for HSBC’s investment bank and it has added new traders and transferred bankers to new roles in recent months. He created a new team of private market-focused dealmakers and promoted James Horsburgh to head his team covering financial sponsors. Julian Wentzel, who runs his global banking business in the UK and international Europe, is moving to Dubai to run his investment bank in the Middle East. He also hired Sarah Wiggins, Greg Scott and Lars Kraemer as senior dealmakers in his UK team.

Banks battled for top dealmakers last year after an unprecedented boom that netted $130 billion in fees across the industry. However, so far in 2022, investment banking revenues have fallen 39%, according to data provider Dealogic, and banks are restarting job cuts that were halted during the pandemic.

Goldman Sachs relaunched its annual 1-5% banker cut in September, and German bank Berenberg also cut 100 positions worldwide. Meanwhile, Canadian investment bank BMO Capital Markets cut off traders, Bloomberg reported.

Across the group, HSBC is on course to miss its cost-cutting target of $500 million next year, chief financial officer Ewen Stevenson told an industry conference on September 12, due to inflation. He added that “the only way to remove that, I think, is to be pretty blunt internally about the costs.”

To contact the author of this story with comments or news, email Paul Clarke

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