The Malta Independent 25 May 2024, Saturday
View E-Paper

HSBC’s decision to cut 180 employees result of ‘successful voluntary scheme applications’

Kevin Schembri Orland Tuesday, 19 November 2019, 11:54 Last update: about 6 years ago

The 180 employees that HSBC expects to shed is not a figure determined by the bank, an official HSBC spokesperson told The Malta Independent, "but the result of successful voluntary scheme applications submitted by the employees."

On Monday, HSBC made an announcement on the Stock Exchange. "On 10 October 2019, HSBC Bank Malta p.l.c. announced a strategic plan to increase its focus on digital banking services and to modernise its branch network. Further to that announcement, the application period for the associated voluntary schemes has closed and communication with employees will start shortly. The Board is now in a position to confirm that it is expecting staffing levels to reduce by around 180 and, as a result, in the financial year ending 31 December 2019 the Bank will incur a restructuring charge of circa €16m. The Bank will however, benefit from ongoing cost savings in future years. The Bank will remain one of country's largest employers. The implementation of the strategic actions announced in October 2019 will enable it to maximise the opportunities arising from changing customer usage of banks and to continue to mitigate long-term impact of negative interest rates."

ADVERTISEMENT

The announcement that the bank intended to shed 180 employees came as a bit of a shock, as while the bank had previously announced that it was going to issue such voluntary schemes, nobody expected that so many employees would need to go. This newsroom asked the bank what would happen if 180 employees did not go for such a scheme, and whether in such a case the bank still push to get rid of the rest and if so how. "The announcement relating to reduction of 180 employees, is not a figure determined by the bank, but the result of successful voluntary scheme applications submitted by the employees," the bank said.

When the bank had originally made the announcement relating to the issuing of voluntary schemes, it had also said that it was going to be closing eight branches. This had raised questions about the bank's future in Malta, however the bank had also announced the creation of a new 'flagship branch' within its principal office in Qormi bringing together its existing Qormi and Balzan branches. "This will be HSBC's largest branch in the country and will deliver the best of the bank's services with improved access such as parking."  This part of the announcement helped calm nerves about the bank's future. The main reason behind this move given by the bank was to increase its focus on digital banking services and to modernise its branch network.

During an interview with this newsroom on the same day at the original announcement - October 10 - HSBC CEO Andrew Beane was asked if there is another reason behind the branch closures, other than the change towards more digital solutions, such as financial issues that the public should be aware of, Beane had said that "the bank is in an incredibly strong position and we have worked through a comprehensive risk management programme over the past few years. We have continued to pay a clear dividend to shareholders and that has been part of our strategy. When you look at the data, the reasons for the changes become self-evident, that the usage of banking services is changing profoundly - the fact that 80% of banking transactions globally are now digital, and 40% of them are on mobile devices. What we have seen in the past couple of years, which is accelerating, is that these trends are coming to Malta, and fast."

He went on to specify how HSBC Malta's customers are using digital services more and more. "What I will say is that we don't have a vision to become only a digital only bank. Our view would be that banking of the future is about bringing the best of the human being and the best of digital technology together. We would want people to be able to conduct their basic banking easily, quickly and in their own time. But if they have a meaningful moment where, for example, they want to buy a house or have a financial problem they want to discuss or make an investment they can also access someone they trust to talk it through. So we are reorganising a bit yes, but it is really driven by these long-term trends," he had said. He had also said that People should feel confident about HSBC.

However the announcement that the number of employees that were going to be removed was 180, even though a voluntary scheme, still raised eyebrows, and thus a set of questions was sent to HSBC. While answering one of the questions relating to the 180 number, the bank did not answer the others. This newsroom had, among other things, asked for information pertaining to what jobs the bank is aiming to cut; Whether these would be from other departments and not just the branches being closed; for the bank to release some specifics about these voluntary schemes; and more importantly whether HSBC is thinking of moving out of Malta or shrinking its customer base locally. 

  • don't miss