HSBC cut investment banking jobs across Europe and the US. Then it started hiring aggressively in China. At first glance, the strategy appears contradictory. But for HSBC, the hiring spree is part of a much larger effort to reclaim lost ground in Hong Kong, the market that generates a significant share of the bank’s profits and remains central to its future ambitions.
The British lender has spent the past year restructuring its investment bank, trimming businesses outside its strongest markets and redirecting resources toward Asia. Now, with Hong Kong’s IPO market roaring back to life and geopolitical tensions creating openings for non-US lenders, HSBC believes it has a chance to win back business it once dominated.
The comeback starts in Hong Kong
The urgency is evident from the bank’s top leadership. According to Bloomberg, Chief Executive Officer Georges Elhedery and senior executives have been personally meeting clients across Greater China. Elhedery has reportedly sent customised video messages to important customers and encouraged executives to engage with around 400 major clients, including private equity firms and hedge funds. This is happening after a difficult period for HSBC’s investment banking franchise in Hong Kong.
A major restructuring in early 2025 triggered senior departures and weakened the bank’s standing in some key deals. One of the most visible setbacks was HSBC’s failure to secure a lead role in the planned listing of A.S. Watson Group, the health and beauty retailer controlled by billionaire Li Ka-shing’s CK Hutchison empire, a long-standing HSBC client.
Why HSBC is suddenly hiring bankers
The answer lies in the opportunities HSBC sees emerging in China and Hong Kong. Hong Kong is experiencing a strong IPO revival due to technology and biotech companies. The city is expected to raise more than $43 billion through listings this year, creating a lucrative pool of advisory and underwriting fees.
To capture a larger share of that business, HSBC has spent the past year hiring more than a dozen investment bankers for its China operations.
The recruits include executives from JPMorgan, Goldman Sachs, Bank of America, Jefferies and Credit Suisse. Among them are Karen Chen from JPMorgan to lead consumer investment banking coverage, Xihong Ai from Bank of America, former Goldman Sachs banker Yuan Shuai, and Shawn Wang from JPMorgan.
The hiring drive shows HSBC’s belief that more bankers on the ground will help it compete more effectively for listings, mergers and capital-raising mandates.Early signs suggest the strategy may be working.
The bank is currently working on about 40 IPOs in Hong Kong, up sharply from just five throughout 2025. Across Asia, HSBC is said to have around 70 IPO mandates.
A chance to exploit Wall Street’s challenges
HSBC also sees an opportunity created by the changing geopolitical landscape. Relations between Washington and Beijing remain strained, making some Chinese companies more cautious about relying heavily on American banks. Regulatory scrutiny has also complicated cross-border dealmaking.
HSBC is betting that its long-standing presence in Asia, combined with its international network, will allow it to capture mandates that might otherwise have gone to Wall Street firms.
The strategy aligns with Elhedery’s broader vision for the bank. Since becoming CEO in 2024, he has pushed HSBC toward what he describes as a higher-performance culture while accelerating a pivot toward Asia and the Middle East.
A little over a year ago, HSBC announced it would stop equity underwriting and advisory services in many Western markets, choosing instead to focus resources where it believes it holds stronger competitive advantages.
The risks behind the expansion
The hiring push comes at a time when HSBC is also dealing with challenges elsewhere. Earlier this month, the bank reported an unexpected $400 million loss linked to a fraud case involving a British mortgage lender. The incident drew attention to banks’ growing exposure to the rapidly expanding private credit industry.
The episode reinforced concerns raised by the Financial Stability Board, which has warned about increasing risks stemming from banks’ connections to private credit markets, including rising defaults, concentration risks and limited transparency.
At the same time, parts of the private credit sector are showing signs of strain. Reuters reported that firms including BlackRock and Blackstone reduced valuations of certain private credit funds during the first quarter, while Blue Owl indicated plans to reduce exposure to software-sector lending.
For HSBC, the timing is significant. As some areas of finance face growing uncertainty, the bank is doubling down on a business it understands well including advising companies, arranging IPOs and helping clients raise capital in Asia.
Can HSBC regain its former position?
The challenge remains substantial. Bloomberg data shows HSBC currently ranks 12th among Hong Kong IPO arrangers this year. In Asia excluding Japan, its market share in IPOs stands at just 0.8%, placing it 34th in the rankings. A decade ago, it ranked fifth. That decline helps explain why the bank is investing heavily in talent despite broader cost-cutting efforts.
As an HSBC spokesperson told Bloomberg, “HSBC is a market leader across a broad range of products and services in Asia. We have strong capital markets and advisory capabilities and our revenue there is growing, and we continue to build market share advising large corporates on high-value transactions.”
Whether the hiring spree translates into a sustained comeback remains to be seen. But one thing is clear, HSBC is making a calculated bet that the future of its investment bank will be decided in Asia.