If you are looking for a banking job in Asia, HSBC might not be your first choice, even though it has promised to protect bonuses from the European Union's bid to curb banker pay.
Thousands of jobs are still on the line as the bank tightens its belt even further to improve cost efficiencies. With Asia (excluding Hong Kong) and other emerging markets falling behind in the latest quarter, jobs there look uncertain as the bank focuses its efforts on faster growing regions.
This week HSBC reported a steady 10% increase in underlying profit, with the rump of that derived from its core Hong Kong and UK operations, which offset a 10% decline in Asia (ex Hong Kong) and a 50% fall in Latin America.
In a cheery outlook statement from the bank’s boss, CE Stuart Gulliver in the Q3 results announcement, he said the slowing of China’s economy looked to be stabilising, and this would be good for the rest of Asia Pacific.
HSBC, the fourth largest bank in the world based on Tier 1 capital, has been going through radical cost surgery, with CE Stuart Gulliver cutting jobs and selling businesses to improve the bank’s cost-efficiency ratio. Bankers' pay, however, seems to be safe, with Gulliver vowing "to protect [the bank's] competitive position on pay amid the EU bonus cap".
But the poorer showing from emerging markets, including Asia-Pacific (ex-Hong Kong), combined with the bank’s ongoing slash-and-burn cost-cutting programme, could crimp hiring in Asia, and further job cuts may even be in the pipeline.
To help Gulliver meet his target of removing another $3 billion of costs from the business by 2016, headcount would need to be reduced by as much as 20,000 globally in the next two years, adding to the 39,700 roles axed since peak employment of 299,000 in 2012.
Analysts say that the bank’s cost-reduction focus is in commercial banking, retail banking and technology businesses. HSBC spokesman Gareth Hewitt would not give specifics about the jobs outlook, but he added that the cost-efficiency ratio (CER) was “…going in the direction we want it to go.
"There are a number of components to the cost-efficiency ratio - we continue to look for sustainable cost savings and that covers a variety of initiatives. (But) we cannot give a forecast of the CER or full-term employment in the future.”
Hewitt did say - offering a glimmer of hope - that the bank was continuing to hire in the area of risk and compliance – 1,600 new roles have been added this year alone - and in "faster growing markets in line with strategy…”.
Athough Gulliver is bullish about China and Hong Kong, recruiters there say that bank hiring is still marginal outside specific areas. Sophia Yan, a senior consultant at Bó Lè Associates in Hong Kong, says bulge bracket banks in Asia are not in an expanding mode, and some are even still cutting front, back and middle office staff.