HSBC restructuring could see closure of Malta operations

HSBC's global restructuring could see the company revisit operations in non-strategic countries like Malta, Bermuda, the Philippines and New Zealand

HSBC is revisiting operations in non-strategic countries like Malta, the Financial Times reports
HSBC is revisiting operations in non-strategic countries like Malta, the Financial Times reports

HSBC’s restructuring process following the COVID-19 pandemic could see the sale or closure of Malta’s operations.

This was revealed in a Financial Times article that reported how HSBC executives are revisiting a list of operations in countries which are considered as non-strategic, including Malta, Bermuda, the Philippines and New Zealand.

Before the pandemic, the bank had already planned to shed 35,000 jobs worldwide, in a move which could see them save more than $4.5 billion in costs.

The plan at that point would have seen the bank focus on its operations in Asia, the area which renders the largest profits.

Having postponed the decision when the COVID-19 pandemic started, an internal report led the company’s board to push for deeper and wider cuts, in view that the pandemic would lump on the bank around $11 billion in bad loans.

Bad loans are credit that is being repaid by companies or people who are unlikely to meet their commitments with the credit institution.

HSBC’s global shares are currently at their lowest levels in decade, with HSBC cancelling its dividend for the first time in 74 years.

In October, HSBC announced it will close down eight branches across Malta.

HSBC Malta CEO Andrew Beane had said the bank was responding to the way customers were banking.

“We are delivering enhanced digital solutions, a modernised branch network with new wealth management centres, and more flexible access to a range of self-service solutions.  With the closure of some branches, this will all be delivered through a more cost-effective operating model which will help us mitigate the long-term impact of negative interest rates on the bank’s profitability in Malta,” he said.

READ ALSO: HSBC to shut down eight branches across Malta as ‘local bank’ pushes online services

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