India will be spared as HSBC axes 1,100 jobs worldwide

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Mumbai, Hong Kong, Sep 26: In the wake of the global financial turmoil, HSBC Holdings is cutting 1,100 jobs worldwide. However, the India operation, which employs around 33,000 people and has 47 branches, will not be impacted by the global retrenchment. “There will be no retrenchment within the Indian staff. There will be no impact on the Indian operations,” said a spokesperson for the bank on Friday. However, there was no comment on whether the bank would increase its exposure to India by cutting down jobs elsewhere.

“We’re doing it because of market conditions and the economic environment, and our cautious outlook for 2009,” Hong Kong-based spokesman Gareth Hewett said. “Markets continue to be challenging and difficult, but our strategy leaves us well positioned for the next wave of global growth, when it comes,” Hewett added. The bank is laying off 4% of the global banking and market operations, with half of them taking place in the bank’s operation in the UK.

HSBC is adding to the about 120,000 financial jobs lost worldwide since the global credit crisis began just over a year ago, leading to more than $520 billion in writedowns and credit losses. The London-based bank last month posted its steepest profit decline since 2001 on subprime mortgage losses. “The financial sector is facing revenue pressure everywhere, and on jobs,” said Sunil Garg, Hong Kong-based head of Asian financials research for JPMorgan & Chase Co. “Everybody is trying to right-size their business.”

The HSBC jobs cuts are in front- and back-office operations. About 500 of the cuts will be in Britain and about 300 more will be elsewhere in Europe and the US. About 100 are in Hong Kong, where the bank’s large Asian operations are based. HSBC will be left with about 26,000 staff in its global banking and markets division. It employs about 335,000 people across the bank.

HSBC was one of the first banks to feel the sting of the subprime mortgage crisis in the US and has booked writedowns or losses of $18.7 billion since the start of the global credit crunch last year. In August, the bank posted a 28% fall in first-half pre-tax profit to $10.2 billion as it took a $14-billion hit from bad debts on US home loans and asset writedowns.