HSBC Cut Jobs

in

Redundancies

700 People in the the Uk WILL lose their job.

HSBC have made net profit (which means they've taken all costs out their profit and they're left with this) of 7 billion pounds.
And even though they have earned an extra 3% over what they made last year. They are still looking to make savings. And thats where the job loss comes in.

The number of job cuts originally was 5,000 which is still a massive number, thats a 'cruise-ship' full of people!
But today 1st of August 2011, The HSBC have decided to cut a further 25,000 jobs and stop operating in 20 countries.

That means 10% of HSBC's workforce, will be without work by 2013. This is, in an effort to save about 2.5 million pounds.

Why?

Investment banking (a way in which money is offered to companies, and business to help with their ability to save and spend money).

Banks have been forced to sell assets (businesses may have software, or even items that hold value) in an effort to support other businesses that may have a better history of being more financially stable.
This is like having 2 cars, and selling one to pay for the others insurance, and running costs.

In general terms the banks have sold smaller businesses, in an effort to support the larger ones.
Banks are less likely to give money to people trying to create new businesses, which means their' predicted profits are lost too.

Selling the smaller businesses allows the banks to hold money, and support themselves through the financial crisis
This loss for investments, means profits are more shallow than expected.