HSBC lays out structure for reshaped investment banking unit

The HSBC headquarters in the Canary Wharf financial district in London, Britain, on Feb 15, 2016.
The HSBC headquarters in the Canary Wharf financial district in London, Britain, on Feb 15, 2016.PHOTO: REUTERS

HONG KONG (BLOOMBERG) - HSBC Holdings Plc detailed a new structure for its investment-banking unit to enlarge the scope of the business to encompass its largest corporate clients, four months after it hired Matthew Westerman from Goldman Sachs Group Inc. to help lead it.

The firm created a corporate, financials and multinationals banking group, led by Philippe Henry, to combine the lending and transaction-banking units, Mr Westerman and Robin Phillips,who jointly lead the investment bank, said Monday in a memo to staff obtained by Bloomberg News. The investment bank also started a structured-finance joint venture with the trading division, which will be run by Kevin Godfrey.

Global Banking and Markets Chief Executive Officer Samir Assaf has reorganised the business amid pressure to cut costs and win more fees from its biggest clients. A few dozen senior bankers have left in recent weeks as HSBC eliminates duplicate roles from the combination of the advisory and capital-financing operations, a person familiar with the matter said.

"The environment around us is changing, and we must adapt," the co-heads wrote in the memo. The new structure will "support our ambition of becoming a consistent top three strategic banking partner to our clients" and "improve returns for our shareholders by improving our profitability and generating efficiencies.

HSBC has slumped 17 per cent this year amid concerns over its revenue outlook as growth slows in Asia, persistently high compliance and anti-financial crime costs and uncertainties over its capital-buffer requirements. CEO Stuart Gulliver has closed about 80 businesses across the world and exited HSBC's least profitable countries as he seeks to reassure investors he can boost returns and guide the bank through turbulent markets.