Two European banks – HSBC and Royal Bank of Scotland – will yet again rely on job cuts in an attempt to nurse their balance sheets back to health.
RBS acknowledged that it will need to cut an unknown number of jobs and close additional branches as it completes its restructuring process and looks to return to private ownership.
HSBC, meanwhile, plans to cut roughly 14,000 jobs, spread across its global footprint, as the bank seeks to reach shareholder equity targets. Group Chief Executive Officer Stuart Gulliver sure doesn’t mind swinging the axe. The U.K. bank has already eliminated 46,000 jobs since Gulliver took over in 2011. The original plan was to cut just 30,000 jobs.
The news is rather ominous for banking employees in general as HSBC just booked a strong first quarter. And the bank pointed toward its desire to increase dividends and buy back shares – rather than meet capital requirements – as the reason for the cuts. HSBC would be the first large European bank to buy back shares following the economic crisis. The street is responding – HSBC shares were up on Wednesday.
It appears cost-cutting has slowly graduated from a need to a want for most chief executives on Wall Street. The question remains how long they can keep short-term profit as their key metric. You can only fire so many people.
Unbiased Bias (Bloomberg)
The IRS didn’t just target right-leaning Tea Party group. It may have discriminated against Democratic groups as well.
Russian Kickbacks (Reuters)
Vladimir Golubkov, chief executive of Societe Generale’s Russian unit, was detained for allegedly taking kickbacks. Golubkov was caught counting cash when police walked in.
Green Light (Financial News)
Shareholders approved Morgan Stanley’s executive compensation plan, although it was a tighter race than a year ago. Proxy adviser Glass Lewis recommended shareholders vote against the plan.
No Biggie (Business Insider)
Goldman Sachs does not "have a major concern" with Bloomberg and the spying controversy, according to Chief Operating Officer and President Gary Cohn.
New Head of Americas (WSJ)
Deutsche Bank has named former Morgan Stanley and Merrill Lynch exec Jerry Miller the new head of its asset and wealth management business in the Americas.
Early Retirement (WSJ)
Energy banker Stephen Daniel has retired from Goldman Sachs. Daniel, 49, was a highly regarded banker who found himself embroiled in controversy over conflicts of interest with his personal holdings.
Buzz Around the Office
Taco Bell Starting to Waffle (Fox News)
If you’re on the lookout for some additional calories, drop by a Southern California Taco Bell. The food chain is testing a new waffle taco. It’s exactly what you would imagine.
List of the Day: Problem Employees
If you’re exhibiting this behavior at work, you could soon be on the chopping block.
- You can’t take ‘no’ for an answer.
- In your eyes, nothing is ever your fault.
- Gossip is a hobby.
(Source: AOL Jobs)