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HSBC Scales Back Hiring Amid Cost-Cutting Efforts

European banking giant HSBC is reportedly slowing hiring and asking investment bankers to reduce expenses.

It’s part of an effort by CEO Noel Quinn to reduce costs as banks around the world anticipate interest rate cuts, Bloomberg reported Tuesday (July 2).

HSBC is in some cases not filling open positions, per the report. And some departments were ordered to halt hiring altogether, although this should not affect client-facing positions.

Meanwhile, HSBC is encouraging investment bankers to hold at least three client meetings per day to capitalize on work travel, the sources said.

These cost-cutting measures are a sign that lenders are preparing for interest rate cuts by central banks, the report said. Such a move would close the door on an era in which high interest rates have driven profits for big banks such as HSBC.

The bank embarked on a minor hiring spree in March, expanding its U.S. commercial banking operations to strengthen its startup lending capabilities.

Wyatt Crowell, head of U.S. commercial banking at HSBC, said at the time that the company was recruiting around 50 more bankers for his department, with plans to boost lending to startups in the tech and healthcare sectors.

“There’s this void in the market, and we’re jumping into it,” he said. “It’s gone way better than I thought it was going to go, both in terms of the volume of deals and our win rate on the deals.”

Elsewhere in the banking sector, the B2B space provides a lucrative opportunity for banks.

“Digital shifts, FinTech partnerships and open banking can all be used to bolster their offerings, provide personalized experiences and transform the branch setting,” PYMNTS reported last month.

However, to float a competitive B2B offering, banks must first understand the nuanced needs of their target audience, as small- to medium-sized businesses (SMBs), large enterprises and specific industry verticals all have unique requirements.

“Banks are starting to realize the speed at which technology has changed the world,” James Butland, vice president of payments and U.K. managing director at Mangopay, told PYMNTS in March.

“The challenge that a traditional bank has is that they sit on 150, 200 years of legacy infrastructure and probably 60 years of legacy technology,” he added. “So, banks have found it difficult to innovate quickly.”