HSBC Considers Home-Office 'Hybrid' Work Model as Bank Ramps Up Cost Cuts -- Financial News
October 27 2020 - 11:01AM
Dow Jones News
By Paul Clarke
Of Financial News
HSBC Holdings PLC said most of its employees could continue to
work in a "hybrid" model, as the U.K. lender looks to accelerate
and expand its cost-cutting program.
The bank could follow rivals by offering flexible working for
its some 230,000 employees after the Covid-19 crisis has forced
large investment banks to send thousands of staff home.
During a call with analysts accompanying its third-quarter
earnings call, Chief Financial Officer Ewen Stevenson, said the
bank could "adopt a hybrid working model for most of our employees
with materially lower internal travel requirements going forward"
as part of its cost-cutting initiatives, which will also include
greater investment in technology.
In a separate interview with Bloomberg TV, Mr. Stevenson said
staff could spend "two or three days in the office, two or three
days at home."
The bank said during its third-quarter results that it would go
"further and faster" on its transformation program that will strip
out $4.5 billion in costs by 2022 and cut around 35,000 jobs.
So far, it has cut around 6,000 jobs, including contractors, in
2020. HSBC executives told journalists during the bank's earnings
call that it was aiming to strip out 10,000 roles before the end of
the year--meaning around 4,000 more need to go in the final
quarter.
Large investment banks have increasingly signaled that working
practices could change permanently, after they were forced to send
the vast majority of their employees home at the height of the
Covid-19 pandemic.
Deutsche Bank AG Chief Executive Christian Sewing also told a
conference on Sept. 24 that it is considering a "hybrid model" for
its workforce that would allow its employees to work from home
permanently for a number of days each week.
Meanwhile, Jamie Dimon, chief executive of JPMorgan Chase &
Co., said up to 30% of the bank's employees could work from home
permanently, rotating between the office and home. UBS Group AG has
also signaled previously that the lasting impact of the pandemic
could mean up to a-third of its staff stay working from home.
A surge in Covid-19 cases in key financial centers like London
and New York has led banks to pause or unwind their plans to bring
employees back to the office.
At HSBC in London, where the bank employs around 10,000 staff,
it paused its plans to start "phase one" of its return to office
program in September. It had just 350 employees at its Canary Wharf
headquarters, and had plans to bring a maximum of 20% of staff back
from the end of September.
While banks have signaled a willingness to keep employees home
on a more permanent basis, executives have said more recently that
longer-term remote working could be damaging.
Mr. Dimon said on Oct. 16 that the negative effects of working
from home were being felt "more and more," while Goldman Sachs
Group Inc.'s chief executive said during the bank's earnings calls
that "being together enables greater collaboration, which is key to
our culture."
Website: www.fnlondon.com
(END) Dow Jones Newswires
October 27, 2020 10:46 ET (14:46 GMT)
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