Bankers expect salary freeze

Top News | BLOOMBERG 3 Dec 2019

The Hongkong and Shanghai Banking Corporation and Hang Seng Bank - two of HSBC's subsidiaries in Hong Kong - will freeze salaries of senior managers next year as the banks expect the difficult business environment to continue.

The lender has completed compensation reviews for next year and submitted the plan to parent HSBC Holdings for approval, reports said citing an unidentified source.

HSBC, which employs about 21,000 people in the city, makes around 90 percent of its profit in Asia. Hong Kong's trade-dependent economy has been pushed into recession this year as political turmoil forced businesses to close and kept tourists away at a time when output was already slowing due to weaker global demand.

The salaries of senior staff, including managers and chief executives, will be frozen, while junior staff in bands four to eight will have a "minimal" pay rise.

In its third-quarter report, the bank credited its operations in Asia with holding up earnings amid challenges in the region. Its adjusted pretax profit in Hong Kong rose 1 percent to US$3 billion (HK$23.4 billion), but the lender also flagged a charge of US$90 million to reflect a deteriorating outlook which has hit small- and medium-sized businesses the worst.

Meanwhile, HSBC Holdings is giving its local employees an extra day off next year as a gesture of encouragement.

The move was announced in a staff memo by Diana Cesar, the bank's local chief executive.

"Thanks to your perseverance and dedication, HSBC has been able to sustain our operation and stand by our customers in this unprecedented circumstance," Cesar said.

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