Global banking giant HSBC said on June 30 it will cut 700 jobs in Britain, and blamed upcoming changes in the law for providing financial advice to consumers. The job losses were announced on the same day that state-rescued Lloyds Banking Group (LBG) unveiled plans to axe 15,000 staff, or 14 percent of its workforce, in a major overhaul to save £1.5 billion a year by 2014.
"700 jobs are at risk in the UK bank and its predominantly in the financial advice area, dotted throughout the country," a HSBC spokesman told AFP. The London-listed bank is reshaping its wealth management business before new rules are introduced in 2013 to govern the provision of advice.
"From then onwards, if you want financial advice you will have to pay for it up front," said the spokesman. "That will vastly reduce the number of people paying for financial advice," he added. HSBC will cut 460 jobs from the financial advice area but it will keep 1,500 advisers within its British retail branch network. The lender added that it will also shed 140 staff from its software development arm, and 100 other positions in so-called "back office" areas like compliance, head office and IT. In contrast to LBG, HSBC survived the 2008 crisis without taking government aid.