HSBC to replace investment bank chief in latest overhaul

Bloomberg

HSBC Holdings Plc is set to replace its investment banking chief as part of an overhaul by interim Chief Executive Officer Noel Quinn, according to people familiar with matter.
Samir Assaf, head of global banking and markets, will be moved to a non-executive role at the bank, said one of the people, who asked not to be named discussing an internal matter. The decision will be announced later this year or early next, according to the person.
Assaf started leading GBM in 2011 and has been at the bank and its predecessors for a quarter of a century. He steps back as Quinn seeks to put his mark on the firm and gain the top job permanently, having replaced John Flint on an interim basis after his ouster in August.
The company, which makes almost 90% of its profit in Asia and employs 240,000 people, last month walked away from a key profitability target and said write-offs are likely for some of its European business and technology spending.
A spokeswoman at HSBC in Hong Kong declined to comment. The news was earlier reported by the Financial Times.
The latest restructuring, HSBC’s third such overhaul in a decade, is likely to result in cuts to the investment bank, particularly its operations outside of HSBC’s core Asian markets. Businesses in continental Europe and North America are the main targets of the reductions.
In a report, analysts at Jefferies Securities said they thought HSBC could eliminate 25% of GBM’s cost base. “We believe management will seek to take a meaningful portion of costs out of the GBM via reducing its product and geographic scope,” said Jefferies. Mark Tucker, chairman of HSBC, told a staff meeting that bank needed to improve its return on capital. Tucker told managers that 30% of the lender’s capital was generating returns of less than 1%.