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By Lawrence White, Sinead Cruise and Sumeet Chatterjee
LONDON/HONG KONG (Reuters) – One of Noel Quinn’s first jobs as chief executive of HSBC (L:) will be to review the radical revamp he unveiled last month as interim boss, a senior source at the bank said.
Quinn’s decisive move to slash costs proved instrumental in securing him the top spot at Europe’s largest lender but those plans, including the axing of 35,000 jobs and shuttering of underperforming businesses, may prove difficult to implement while the world grapples with the fallout from the coronavirus pandemic.
“You can’t fire a trader in Europe over the phone when he is either working from home or taking care of a sick family member,” a second HSBC source said.
HSBC will review the social, economic and political impact of the virus, the first source said, adding that the bank could still decide to proceed with its existing plans.
A spokesman for HSBC declined to comment.
The coronavirus was largely concentrated in China when HSBC, which makes the bulk of its profits in Asia, announced its restructuring. The lender made reference to the impact of the virus at that time, but the magnitude of the crisis has grown exponentially since then. Some 200,000 people have been infected, nearly 8,500 have died and whole countries have been put on lockdown to try and staunch the virus’ spread.
Quinn, an HSBC veteran who has been interim CEO for the past seven months, was named to the job full-time on Tuesday minutes after the British government announced a ‘wartime’ spending effort to combat the impact of the coronavirus. [nL4N2BA4PB]
At least two HSBC staff, one in London and one in Dubai, have been diagnosed with COVID-19, the flu-like disease caused by the virus, and, like other banks, HSBC has told staff to work from home to try and slow down any contagion.
The escalating panic on world markets prompted HSBC Chairman Mark Tucker to appoint Quinn after earlier approaches to a number of outside candidates.
“You don’t want to be seen dealing with regulators and shareholders almost on a daily basis, without a permanent CEO in place,” the second HSBC source said.
Investors, who have previously expressed frustration at the time it took the bank to pick a permanent boss, said Quinn, a 33-year-veteran of HSBC, will be a safe pair of hands.
“My view is that Quinn has done a good job as interim CEO and that chairman Tucker’s more or less public interview process for alternative candidates just shows how difficult a role it is to fill,” said Ali Miremadi, portfolio manager at GAM.
Quinn sounded a rallying cry in an email to staff, seen by Reuters, after his appointment was announced.
“We have a history of staying calm in difficult times, dealing with the issues at hand, and standing firm for our customers. We must do the same again,” he said.
