HSBC India to escape global job cuts

At a time when Hong Kong and Shanghai Banking Corporation (HSBC) is cutting 30,000 jobs globally, its Indian operations may not see any such retrenchment as growth for the bank remains intact in the third largest Asian economy.

HSBC on Monday said it had cut 5,000 jobs following restructuring of operations in Latin America, the United States, Britain, France and the Middle East and that it would cut another 25,000 between now and 2013.

An HSBC spokesperson in India said the though the bank will re-allocate 120 officials in different departments but the exercise should not be seen as a part of the bank’s global restructuring plan.

“There is no question of job cuts in India and Asia as we the growing in these geographies,” the spokesperson said. HSBC has around 35,000 employees in India.

"While Asia is a growth story, all our businesses will be reviewed via the five filters as stated during the group's Strategy Day in May this year, as we continue to look for opportunities to improve efficiencies," added the HSBC spokesperson.

Healthy growth in loan book coupled with lower impairment charges has helped India operations of HSBC to post a net profit growth of 89 per cent to Rs 1,528 crore for the year ended March 31. Indian operations continue to be the seventh largest contributor to the HSBC group's profits. The loan book grew of the bank grew by 17 per cent to Rs 27,401 crore from Rs 23,475 crore last year.

HSBC on Monday announced -half pretax profits of $11.5 billion, up from $11.1 billion a year ago, higher than analysts’ estimate.

The bank’s Chief Executive Stuart Gulliver said reporters in a conference call that there will be further job cuts. "There will be something like 25,000 roles eliminated between now and the end of 2013." The cuts equate to roughly 10 percent of HSBC's total workforce.

Gulliver's overhaul, first unveiled three months ago, aims to slash costs and scale back the bank’s global spread.

HSBC said on Sunday it would sell 195 U.S. branches to First Niagara Financial for about $1 billion in cash, and close another 13 of the 470 sites it had.

HSBC also intends to sell its U.S. credit card portfolio, which has more than $30 billion in assets, a move which would free up capital. Capital One Financial Corp and Wells Fargo are among the bidders, sources have said. Another suitor could be Barclays.

"We still have a number of people interested in that business. If we can't get the price we're looking for we have a number of options -- we can run it off, sell it in pieces, we could decide to keep the retail private label cards," Gulliver told reporters.