HSBC Will Cut Jobs
May 15th 2013 6:55AM
The brutal drive toward operating efficiency that many large companies adopted during the recession continues, despite what most economists call a recovery. Cost cuts are not any more evident than at banks, which for the most part, took the brunt of the financial meltdown. HSBC Holdings PLC (NYSE: HBC) was the latest to say it would slash what it cost to run the bank, according to The Wall Street Journal:
HSBC Holdings PLC said Wednesday it will cut around 14,000 more jobs.
The bank will shave up to $3 billion from its cost base and increase shareholder dividends.
In a strategy update, Chief Executive Stuart Gulliver said the bank may struggle to meet its 12%-15% return-on-equity target for full-year 2013 because of the squeeze on revenue from a weakened global economy, but that the target is achievable in the 2014-16 period as the bank makes fresh investments in growing markets and commercial banking.
He said the bank wants to increase dividends to shareholders within a continuing target range of 40%-60% of earnings, and could buy back shares to counteract the dilutive effect from some shareholders collecting their dividends in the form of more shares. HSBC paid out 55.4% of its earnings last year in dividends.
Filed under: 24/7 Wall St. Wire, Banking, Dividends & Buybacks, Jobs Tagged: HBC