HSBC Holdings Plc is considering to close its retail banking business in the United States as the lender is struggling to increase its performance in North American markets, Financial Times reported recently.
Though not officially confirmed, the senior managers of the bank are said to be pitching a plan for the exit next month to the board.
Despite pulling out from retail banking, the London-headquartered bank will retain its investment banking activities in the US, but the management is considering to reduce its size, focusing mainly on the institutional clients in Asia and the Middle-East.
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This move came when HSBC is already restructuring its business across the globe. The bank already drafted a plan to lay off around 35,000 staff from its global offices. Finance Magnates earlier reported on the bank’s plan to shed 300 employees from the UK offices and cut 255 jobs from its offices in France; both are parts of the major restructuring plan.
Last week, the UK lender parted with its US fixed income trading desk head, Michael Yarian, which is also seen as a part of the bank’s overall restructuring program.
HSBC reported a total operating cost of $42.3 billion for 2019 and has set an astronomical target to reduce its costs. In February, the bank revealed that it is aiming to reduce annual costs to below $31 billion by 2022. The ongoing restructuring is a part of that ambitious plan.
Furthermore, HSBC’s banking businesses were affected by the impact of the ongoing pandemic in the industries. In the first quarter of 2020, its profits went down by 48 percent.