HSBC is reportedly considering scaling back its retail banking operations in Mexico, Malaysia, Indonesia and some other countries.
The bank is considering focusing only on wealthier clients in these markets as it looks to cut costs and focus on its core markets, which are the United Kingdom and Hong Kong, the Financial Times (FT) reported Thursday (Dec. 12), citing unnamed sources.
No decision has been made on these changes, according to the report.
HSBC did not immediately reply to PYMNTS’ request for comment.
The bank entered Mexico in 2002 and has gained deposits of almost $30 billion but has faced challenges, including a $2 billion fine by U.S. authorities in 2012 for failures that allowed money laundering, according to the FT report.
HSBC already exited consumer operations in the United States, Canada and France as part of a pullback from its earlier global expansion, the report said.
HSBC Group Chief Executive Georges Elhedery, who took that role in September, aims to streamline the bank’s operations and reduce its costs by focusing on wealthier clients, per the report.
The bank has already announced job cuts that could deliver annual savings of $500 million, according to the report.
HSBC said in a Dec. 5 press release that it completed the next stage of its global reorganization, saying it appointed the senior leadership teams across the four key businesses through which it will operate.
“The new structure will ensure we can better focus on the businesses where we have clear competitive advantage and the greatest opportunities to grow — and will help us to deliver best-in-class products and service excellence to our customers,” Elhedery said in the release.
HSBC announced its restructuring in an Oct. 22 press release, saying it was streamlining decision-making and eliminating redundancies.
It said it is doing so by reorganizing into four distinct business units: Hong Kong, U.K., Corporate and Institutional Banking, and International Wealth and Premier Banking.
In addition, HSBC’s 18-member Group Executive Committee will be replaced by a new Group Operating Committee comprised of 12 members.
The bank’s changes are set to be implemented Jan. 1, 2025, it said in the two press releases.
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