If you had any doubts about the importance of Asia to HSBC, its first quarter results should put those to bed. The bank generated 80% of its profits from the region last quarter – and Asian profits were up 5% to $5,006m. But this doesn’t mean that joining HSBC in Hong Kong or Singapore will give you an unusually secure job – far from it.
Speaking earlier today, HSBC CFO Ewen Stephenson said Asian economies had softened recently, but that trend was yet to affect the firm’s regional numbers. Worse still, HSBC has vowed to further reduce costs so it can hit its 2020 financial targets. This could lead to job losses, although the bank’s total headcount of 238k would stay roughly similar.
“We look at where we should invest and have headcount all the time, at where we need to employ new headcount in some places and reduce in others,” said Stephenson. Where should you work if you want to avoid the job cuts at HSBC? And which roles are vulnerable? Stephenson didn’t say, but the firm’s Q1 earnings report provides some suggestions.
Global Banking and Markets: avoid trading credit products
HSBC CEO John Flint last month began a cost review targeting the firm’s underperforming Global Banking and Markets (GBM) division (which includes its investment bank). HSBC didn’t make the top-10 banks for Q1 APAC (ex-Japan) revenue in either M&A or ECM (although it did place sixth in DCM), according to Dealogic data. HSBC’s own results reflect this trend: global banking revenue was down 9% year on year to $935m, and global markets revenue fell 5% to $1,741m, driven by a 29% decline in credit products.
GBM: stick to the boring bits
Jobs within GMB aren’t all about trading and investment banking – the unit also contains some more mundane (but more stable) transaction banking functions. The global trade and receivable finance team, for example, saw its revenue rise 12% year on year to $211m, partly because of a strong performance in Asia. In global liquidity and cash management, revenues were up 13% to $687m.
Get a technology job at HSBC in Hong Kong
HSBC increased its spending on its “technology and digital capabilities” last quarter, a key part of an overall 15% rise in investments to $1bn. It’s likely that Hong Kong would have been a major beneficiary of this new money, because HSBC uses the city as a global hub for digital projects. What kind of experience might get you a technology job at HSBC? Its Q1 earnings don’t say, but the bank’s 2018 financial results mention mobile banking, machine learning, and speech recognition as priorities. The 2018 report also highlights the growth of HSBC’s PayMe app in Hong Kong, which now processes 3m transactions per month.
Big hiring in private banking
HSBC’s Global Private Banking division may not seem like the most appealing part of the bank to work for. It contributed just 1.5% of the firm’s profit in Q1, and revenue decreased 4%. But in Asia, the private bank is expanding – HSBC made “investments to support business growth” in the region during the first quarter. Translation: hiring. In September last year HSBC began a wide-reaching recruitment drive to add about 650 new staff (including relationship managers) in Asian private banking, mainly in Hong Kong and Singapore. It has also set up a new unit to serve ultra-high-net-worth clients (people whose assets exceed $30m).
Compliance isn’t dead yet
Alongside Standard Chartered, HSBC has traditionally been one of Hong Kong’s most aggressive recruiters of compliance professionals. Although compliance hiring in the city has fallen from its mid-decade peak, HSBC appears to still need more staff. It continues to “invest in regulatory and compliance programmes”, according to its Q1 report.
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