British banking major HSBC is trimming its Swiss workforce and reducing its Geneva office space as part of its cost-cutting efforts, reported Financial Times.
The bank’s Swiss private banking division was forced to reduce costs after its wealthy clients pulled out a net $1bn of cash last year.
HSBC employees working in Quai des Bergues office would be required to share their desk after the bank give up two floors of the building, according to a memo seen by the publication.
“This will reduce our Geneva building cost by 20% for the coming years, representing a significant contribution to improving the profitability of the Swiss bank,” HSBC was quoted as saying in the memo.
The move to slash office space is said to be part of the bank’s group-level policy to trim 40% from its global head-office costs gradually.
In addition to job-cuts, HSBC is also relocating several of its back- and middle-office employees to cheaper locations, including the bank’s outsourcing centres in Mumbai and Poland.
The new development comes a year after the bank revealed plans to invest in the Swiss arm as part of a plan to grow its wealth management business in the country.
HSBC Swiss private bank’s net new money reduced by $1bn last year, according to two people privy of the unit’s performance.
One of the sources said that the drop was due to few of the bank’s large clients withdrawing their assets, rather than a reduction in the total number of customers.
HSBC is expected to post its full-year earnings on 22 February 2022.
In 2019, HSBC Swiss private banking division agreed to pay $192.35m to the US authorities to settle charges in connection with helping its affluent US clients dodge taxes.