BANKING giant HSBC has been urged to support communities set to be hit by the company’s plans to cut thousands of jobs and close branches.
Hundreds of bank staff across Yorkshire were left facing months of uncertainty after HSBC revealed yesterday that it would reduce its UK workforce by 8,000.
The UK will also be one of the countries hit by a plan to close more than one in ten of its branches globally.
The company has 94 branches in Yorkshire, which is also the home of the headquarters of its First Direct subsidiary, employing around 2,000 staff in Leeds, and its European IT hub in Sheffield.
HSBC has already closed 371 branches nationwide over the last seven years, according to figures from the Campaign for Community Banking Services, giving it the smallest High Street presence of any of the big four banks.
Shadow Chancellor Chris Leslie said: “Front-line staff deserve to be treated fairly, so the bank’s management should take a voluntary approach to reductions in the number of workers wherever possible.
“The Government should work with HSBC and encourage them to minimise the number of compulsory redundancies and also ensure that support is provided to the parts of the country worst affected.”
HSBC confirmed that it would make a decision over whether to move its global headquarters out of the UK by the end of the year.
Chancellor George Osborne is expected to use his Mansion House speech tonight to offer an olive branch to the banking sector in areas such as the banking levy which last year cost HSBC £720m.
HSBC is also being hit by new rules forcing banks to ringfence their retail and investment arms and yesterday it confirmed that it will be rebranding its branches as part of the change.
The announcement triggered speculation that it might revive the Midland Bank brand, the name branches carried until they were swallowed up by HSBC in 1992.
It also fuelled suggestions that the company is preparing to off-load its UK retail banking operation.
HSBC could choose to capitalise on the high customer satisfaction ratings enjoyed by First Direct and add branches to the business which currently operates by telephone and online.
The group said it was undertaking a “significant” reshaping of the business and was aiming to cut annual costs by £3.3bn by 2017. Chief executive Stuart Gulliver said: “We recognise that the world has changed and we need to change with it.”
Yorkshire-based banking consultant John Kirkbright, chief executive of K-Strat International, described HSBC’s announcement as “another step on the inevitable demise and decline of UK retail banking”.
Mr Kirkbright said all banks were now using digital technology – with more customers now able to bank online – to reduce costs like branches and to do so faster than their competitors.