HSBC Axes Investment Banking Operations Amid Ongoing Restructuring

HSBC has reportedly unveiled plans to scale back sections of its investment banking operations across the UK, Europe and North America as part of its ongoing restructuring efforts.

Europe’s biggest bank plans to discontinue equity underwriting and advisory services outside of its core operations in Asia and the Middle East.

Instead, it will concentrate on maintaining targeted M&A and equity capital markets capabilities in these regions while phasing out these activities in Europe, the UK, and the Americas.

Even though the bank will cease advising on takeovers and stock market listings, it confirmed to staff that it plans to complete all ongoing deals and mandates.

The FT reported that HSBC’s equity underwriting and advisory units lack the necessary scale, making it challenging to build a competitive presence. As a result, continuing efforts to break into these markets would not be the most effective use of the bank’s resources.

Following the changes, HSBC will maintain its debt capital markets, leverage finance, real asset finance and infrastructure finance business in those markets, as those units have greater scale.

The decision is part of a broader restructuring initiative led by CEO Georges Elhedery, who succeeded Noel Quinn as CEO last year.

As part of the major restructuring, the bank reorganized its business divisions into Corporate and Institutional Banking and International Wealth and Premier Banking.

These divisions were initially split between two regions: eastern markets, encompassing Asia-Pacific and the Middle East, and western markets, covering the UK, Europe, and the Americas.