September 8th, 2011
06:45 AM GMT
Share this on:

(CNN) – The summer bloodletting from multinational banks isn’t over.

HSBC, a huge employer in Hong Kong and an anchor in a city known as Asia’s financial hub, announced that 3,000 people – roughly 10% of its workforce – will be out of a job by 2013.

The cuts are part of HSBC’s plans to eliminate 30,000 positions worldwide.

HSBC employees won’t be alone hitting the bricks with resumes in hand. This week, the Charlotte Observer – the hometown paper for Bank of America – wrote the largest bank in the U.S. plans to shed between 25,000 and 30,000 jobs.

Last week, Dutch bank ABN Amro said it will cut 2,350 jobs. In Stockholm, Nordea, the largest bank in the Nordic region, plans to cut 2,000 workers.  The week before Swiss bank UBS announced 3,500 job cuts.

Other layoffs reported in recent months:

Lloyds TSB – 15,000 jobs

Barclays PLC – 3000 jobs

Credit Suisse –  2000 jobs

RBS – 2000 jobs

Wells Fargo & Co. – 1,900 jobs

Bank of New York Mellon –  1,500 jobs

Goldman Sachs –  1000 jobs

Why? As stock prices sink, banks are looking for ways to boost their bottom lines – and nothing is faster than cutting staff. Employees represent around 60% of a bank’s expenses, and a payroll cut is instant money left in the banks.

The spiraling debt problems in Europe have global investors worried about the economic health of banks there; Swiss banks like UBS and Credit Suisse were pummeled by the strong Swiss franc. Fears are profound that a euro contagion could jump the Atlantic, and all are jittery about a double-dip recession.

Another reason, as Andrew Ross Sorkin at the New York Times pointed out: Reduction of those banker bonuses that caused such uproar in the wake of the financial crisis. Instead, banks have increased salaries to compensate, Sorkin explains. But unlike bonuses, which could be adjusted based on a bank’s financial performance, salaries are a fixed cost.

So rather than axe bonuses, banks are axing bankers.



soundoff (21 Responses)
  1. Beefburger

    Wow, I'm the firsty cow? Mooooo!

    I am sorry, I don't feel bad for anyone in the financials sector, just as bad as lawyers.

    September 8, 2011 at 7:41 am |
  2. Beefburger

    Most of these "banking professionals" will receive a golden parachute of some kind when most deserve a final meal, a cigarette, and a blindfold.

    September 8, 2011 at 7:44 am |
  3. WorldIsRound

    This is good as banking and finance sector have sucked many other technically brilliant people and paid them to show their creativity in fraud. We need a culture of earning through one's creative and not creative earning!

    September 8, 2011 at 7:44 am |
  4. Commoner

    While some of the comments are true below, the people loosing there jobs wont really be the evil geniuses...they will be the low level foot soldiers

    September 8, 2011 at 9:40 am |
  5. Prof.Raju G

    Very good move by the banks...we need man-less banks like man less factories. In banking, everything can be done by software and almost half the work done by the customer himself and where is role of costly bank employee. You learn from ICICI bank India and 50% of the its banking work done by its customers and they are more efficient and more productive and least cost. And these banks carry activities with the help of customer s and maintain only skeleton staff at branches level. Even though many jobs are outsourced to Asian countries such as India, Philippines and Indonesia through their Global Outsourcing centers. Majority of these jobs can be done by college dropouts in villages at the cost of 1/10th of developed countries cost. No need to keep costly MBAs and high profile experience people in these banks if banks want to Expand in emerging markets such as India and China.

    September 8, 2011 at 10:40 am |
  6. American Joe

    This is the fruit of corporate greed and Republicanism and what you can expect from them. Even for all those middle income types who believe in their rhetoric will eventually end up on the short end of the preverbal stick.

    September 8, 2011 at 11:06 am |
  7. Frank

    Bankers have hearts too. Don' t they?

    September 8, 2011 at 11:20 am |
  8. Carl van Zijll de Jong

    It might be a bad time for a “banker”, but for society it is an opportunity to be released from an entity that has contributed to the dire economic situation. We need to formulate a different protocol for money exchange institutions. For your information Google The World Monetary Order.

    September 8, 2011 at 11:27 am |
  9. edwwsw

    So 10% of HSBC workforce = 3,000. Means their entire workforce is ~30,000. Next sentence – "The cuts are part of HSBC’s plans to eliminate 30,000 positions worldwide". So HSBC is planning on laying off their entire workforce. Something isn't right here.

    September 8, 2011 at 1:33 pm |
  10. Aaron

    Some of these comments are ridiculous and full of misdirected vengeance. Yes, banks and people in high-ranking banking positions contributed to our economic situation. Because of this you think the employees who work in departments such as Card Services and Loan Servicing, who have families to support just like you do, should lose their jobs (which, by the way, probably don't pay that well to begin with)? And, no, they will not receive the so-called "golden parachute". These aren't millionaires, they lower-middle class folks who work hard and they'll be lucky to receive much in the way of a severance package. I agree, banks have messed up, but I do not think it's right to celebrate the fact that so many Americans will lose their jobs.

    September 8, 2011 at 1:42 pm |
  11. coder

    no worries – if it werent for banks selling greed like crack – what would a politician do, actually work????

    September 8, 2011 at 1:52 pm |
  12. virgincapt

    no tears lost here

    September 8, 2011 at 1:52 pm |
  13. Joe

    There's a free morning financial paper in London that reported this story a couple of days ago. It was very sympathetic to the banks – saying that it certanly was NOT business as usual. Then a few pages inside in their 'lifestyle' section they a ran a story about an investment banker couple who bought an old rundown victorian home that was divided into 3 homes and rented by three generations of the same family. They effectively threw out the tenants and refurbished it into a $4,000,000 single family home, now on the market. Right next to this was an ad for studio apartments close to the financial centre going for a mere $350,000. I feel sorry for the part time receptionist at the local branch of HSBC, trying to make ends meet for her two kids, who'll lose her job. But it's hard to feel anything but resentment for banking in general when millions of dollars in bonuses are handed out at Government owned banks. Ultimately we will suffer for their losses in reduced services and higher fees. It's just a shame the cuts can't be targeted at the people who caused the problem.

    September 8, 2011 at 2:47 pm |
  14. Mike

    This is great news for the senior bank executives. Fewer peons to manage and fewer people they need to share their big, fat bonuses with.

    September 8, 2011 at 4:47 pm |
  15. Ben

    It sounds as though 3000 people are being laid off in Hong Kong, which represents 10% of its workforce there, and is part of a cut of about 30,000 world wide (meaning that the 27,000 will be coming from other offices). Still, horrible writing, and bad journalism none the less. What credibility can you attribute to a story written by someone who cannot even competently perform the most basic requirement of the position?
    More troubling is the apparent indication that whatever economic malaise the world is currently experiencing is going to remain with us for some time. Banks fire people because they are not producing, and/or the economic outlook suggests that opportunities to make money in the near future are slim, and are fully realizable with a drawn down staff, making those slated to be fired, redundant and unnecessary. That's what should be troubling people, not some fake sympathy for people being out of work, and the suggestion that these people are somehow the victims of greedy banks. It's too bad that the governments around the world aren't as conscientious about managing themselves, which is essentially their number one responsibility, like these banks do. If there were no severe sovereign debt crisis, then these banks would not be firing people now, nor would we be talking about a double dip recession.

    September 8, 2011 at 7:00 pm |
  16. Babak from Los Angeles

    They are useless anyways .... I went to my branch of B of A to ask a question about my account. They asked me to call the 800 number at the counter, while I was at the bank!!! Somehow that did not compute in my head.

    September 9, 2011 at 2:37 am |
  17. RL

    In 2009, Volkswagen made a profit of US$1.2 billion or less than one per cent of its revenue of US$137 billion. Almost US$29 billion of the revenue generated added value to society in the form of employment, dividends to investors, and taxes.

    In contrast, Goldman Sachs made a profit of US$13.4 billion despite receiving US$10 billion of US government aid in the first three months of 2009. That’s 10 times the profit of the carmaker for the entire year.

    “Is it fair for a bank to make ten times the profit of a car manufacturer when that excess return comes not from supporting economic growth, or financing business development, but from gambling?” – economist Graeme Maxton

    September 9, 2011 at 8:16 am |
  18. get facebook like

    Fantastic beat ! I wish to apprentice at the same time as you amend your web site, how could i subscribe for a weblog web site? The account aided me a applicable deal. I had been tiny bit familiar of this your broadcast provided bright clear concept

    September 6, 2012 at 5:28 am |
  19. icons downloads

    In my opinion you are not right. I am assured.

    P.S. Please review Desktop Buffet Icons from iconswindows35

    September 20, 2012 at 7:53 am |
  20. icons set

    Juszt that is necessary. An interesting theme, I will participate. I know, that together we can come to a right answer.

    hpixel

    September 22, 2012 at 4:44 am |
  21. icon archive

    Curious question

    October 5, 2012 at 4:37 am |

Post a comment


 

CNN welcomes a lively and courteous discussion as long as you follow the Rules of Conduct set forth in our Terms of Service. Comments are not pre-screened before they post. You agree that anything you post may be used, along with your name and profile picture, in accordance with our Privacy Policy and the license you have granted pursuant to our Terms of Service.

About Business 360

CNN International's business anchors and correspondents get to grips with the issues affecting world business, and they want your questions and feedback.

 
 
Powered by WordPress.com VIP