HSBC to push on with overhaul 'wherever possible' despite crisis

[LONDON] HSBC will press ahead with plans to reallocate capital from under-performing businesses, cut costs and strip out layers of management, despite problems caused by the coronavirus pandemic.

Chief executive Noel Quinn said HSBC will proceed "wherever possible" with a transformation plan outlined in February, but has paused most of the associated redundancies.

Europe's biggest bank announced its latest cost-cutting plan before the coronavirus spread across Europe, leading investors to question whether HSBC would be able to carry it out.

HSBC has said it will pause job cuts in order to avoid disruption and leave staff unable to find work elsewhere, but Mr Quinn's re-commitment to the February strategy in a filing ahead of its annual shareholding meeting will remove some uncertainty.

It will be the first major British lender to report first quarter earnings, on April 28, with a sharp rise in provisions against bad loans expected.

HSBC also apologised again to shareholders for cancelling its dividend, a move that sparked widespread outrage and a possible lawsuit from Hong Kong retail investors, many of whom rely on the payouts for a significant part of their income.

"We recognise that many shareholders are deeply disappointed by the cancellation of the dividend and we profoundly regret the financial consequences (it) will have on shareholders," HSBC chairman Mark Tucker said in the filing.

REUTERS