HSBC says it will cut around 4 000 jobs, or 2% of its workforce, while Chief Executive John Flint is stepping down after less than two years on the job. The bank pointed to the need for a change in leadership to address a “challenging global environment.” The lender has been grappling with digital disruption, trade and geopolitical tensions and a slow turnaround in its U.S. business. Fellow European lenders Barclays and Societe Generale have also announced job cuts recently.
The bank’s structural adjustment comes barely 2 weeks after Deutsche Bank announced plans to layoff 18,000 professionals, as a result of deteriorating business conditions at the bank. Also, Citigroup plans to lay off hundreds of people. This announcement is consistent with a trend in downsizings at major banks, due to declining revenue across the industry and digitalization.
John Flint is giving up the role he has held for a year-and-a-half “by mutual agreement with the board”.
He will immediately cease his day-to-day responsibilities at HSBC, but will help with the transition as Noel Quinn takes over as interim chief executive.
Chairman Mark Tucker thanked Mr Flint for his “commitment” and “dedication”.
However, he said: “In the increasingly complex and challenging global environment in which the bank operates, the board believes a change is needed to meet the challenges that we face and to capture the very significant opportunities before us.”
Donald Trump has dismissed the report as fake news
Anti-money laundering staff at Deutsche Bank flagged Trump, Kushner transactions: NYT//RTE
Anti-money laundering specialists at Deutsche Bank AG recommended in 2016 and 2017 that multiple transactions involving entities controlled by US President Donald Trump and his son-in-law, Jared Kushner, be reported to a federal financial-crimes watchdog, the New York Times has reported.
The newspaper, citing five current and former Deutsche Bank employees, said executives at the German-based bank, which has lent billions of dollars to the Trump and Kushner companies, rejected their employees’ advice and the reports were never filed with the government.
US President Donald Trump and his son-in-law Jared Kushner
Deutsche Bank denied the report but shares in Germany’s largest bank hit a new low today, below a previous minimum set in December.
At 11.50am, shares traded down 3.2% at €6.62.
The compliance allegations are the latest in a wave of problems to beset the bank which faces investors at its annual meeting on Thursday.
The Times said the transactions, some of which involved Mr Trump’s now-defunct foundation, set off alerts in a computer system designed to detect illicit activity, according to the former bank employees.
Compliance staff members who then reviewed the transactions prepared so-called suspicious activity reports that they believed should be sent to a unit of the Treasury Department that polices financial crimes, according to the newspaper.
Deutsche Bank responded with a denial of the report.
“At no time was an investigator prevented from escalating activity identified as potentially suspicious,” the bank said in a statement.
“Furthermore, the suggestion that anyone was reassigned orfired in an effort to quash concerns relating to any client iscategorically false.”
In a series of tweets, Mr Trump dismissed the claims as fake news and said Deutsche Bank was “very good and highly professional to deal with”.
Deutsche is facing a series of headaches.
Investors are calling on the bank to scale back its investment bank after talks to merge with a rival failed and amid a grim profit outlook. European regulators also fear Deutsche could fail US stress tests.
The Times reported the bank employees viewed the decision not to report the transactions as a result of a lax approach to money laundering laws.
They said there was a pattern of bank executives rejecting reports to protect relationships with lucrative clients, according to the newspaper.
One employee who reviewed some of the transactions said she was terminated last year after raising concerns about the bank’s practices, the Times reported.
A spokeswoman for the Trump Organization told Reuters “the story is absolute nonsense.” “We have no knowledge of any ‘flagged’ transactions with Deutsche Bank. In fact, we have no operating accounts with Deutsche Bank,” she said.
The newspaper said a Kushner Companies spokeswoman called any allegations of relationships involving money laundering” made up and totally false.”
The Times said the nature of the transactions was not clear.
At least some of them involved money flowing back and forth with overseas entities or individuals, which bank employees considered suspicious.
The report surfaces at a time when congressional and New York state authorities are investigating the relationship between Mr Trump, his family and Deutsche Bank, and demanding documents related to any suspicious activity.
Mr Trump has sued in court in an attempt to block US House of Representatives subpoenas for his financial records that were sent to Deutsche Bank, Capital One Financial Corp and the accounting firm Mazars LLP.