While the mid-senior level employees of HSBC were eagerly looking forward to their bonuses, what they actually received was news of their layoff! These employees at the vice president level and above, were eliminated as part of cost-cutting measures, and were not given any bonuses at all.
While there is no official announcement in this regard yet, as per a Financial Times report, this kind of sudden termination is very unlike HSBC, which has a reputation of treating its employees very well. Clearly, cost management seems to be the priority for HSBC now amidst the uncertainties, high interest rates and economic challenges in the finance and banking sector.
For some time now, HSBC has been trying to enhance profitability in its investment-banking division by concentrating on growth areas, especially since Georges Elhedery took over as CEO just over a year ago.
In January this year, it was reported that while most bankers were already enjoying or expecting higher bonuses in the European banking industry, HSBC had told its employees to keep their expectations low. The financial institution was preparing to reduce costs and was already in the process of restructuring as a part of these efforts.
While the incentives to be given were not finalised in January 2025, it was reported at the time that the payouts were going to be below expectation. The payouts, it was indicated, would also vary as per the performance throughout the year. The bank had conveyed that it intended to be fair in terms of rewarding its employees across its global offices.
