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“Following weeks of speculation the worst fears of HSBC staff have finally been confirmed with the announcement that over 25,000 staff will be cut from across the global business by the end of 2013," said David Fleming, national officer from trade union Unite. "Today while the bank reports strong profits, its staff face an uncertain future as the management press forward with this brutal restructuring. It is now necessary for the bank to confirm to its UK workforce how this news will impact on them. The employees being hit by these extensive cuts were in no way responsible for the banking crisis, yet it is these staff many of whom are low paid, who are having to pay for the bank’s recovery. As the business is restructured Unite is demanding that HSBC take every possible step to avoid any job losses and focus on re-training and redeployment as opposed to redundancy.”



The bank employs 307,000 staff globally and is seeking to reduce costs by up to 3.5 billion US dollars over the next few years. The reductions will be made by closing retail banking operations in countries considered too small. The bank has already announced the closure of its retail banking operations in Poland, as well as 700 job losses in the UK.



HSBC has also sold its upstate New York branch network to First Niagara Financial Group Inc. as it trims U.S. operations and seeks to reduce its U.S. network of 470 branches by almost half.



The cuts were not unexpected in the light of the statement in May by Stuart Gulliver, HSBC’s new chief executive, that the bank would have to deploy capital more efficiently, to improve cost efficiency and to target growth in selected markets.



However, the bank’s decision to cut work places comes at a time when it has obtained very good results. Profits for the first half (11.5bn USD) went up 3 % compared to the first half of 2010 and by 45 % compared to the second half of the year. At the same time, for example, loan impairment and other credit risk provisions went down 30 % compared with the first half of 2010 and 19 % compared to the second.



In a report on the company's second-quarter earnings, Gulliver reiterated HSBC’s ambition to become "the world’s leading international bank."



If they want to achieve that goal, UNI urges HSBC to engage in a dialogue on what the next steps will be.



The head of UNI Finance Marcio Monzane sees the trend to cut work places as unsustainable.



"Stuart Gulliver, Douglas Flint and other employers in the finance sector should understand that they can’t achieve the tier 1 demands or endless cost efficiency by cutting work places, thus putting more and more pressure on the remaining staff," Monzane said. "The contribution by hardworking employees to the success of the banking industry has been forgotten, as has the need for reasonableness in result targets and in bonuses paid to the CEOs."