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HSBC, on Thursday, announced it will halve its branch network in India to 26 branches from the current 50 spread across 14 cities. The move could lead to over 300 job losses.
The foreign bank attributed the move to “changes in the behaviour of customers, who are increasingly using digital channels for their banking” and follows a strategic review of its Retail Banking and Wealth Management (RBWM) business in India.
A spokesperson said less than 1 per cent of HSBC’s total workforce of over 33,000 in India would be impacted by this decision.
HSBC, in a statement said, it does not expect any additional branch consolidation beyond what has been announced today. The consolidation of the branch network will take place over the coming months in a phased manner.
According to the bank, the branches being consolidated account for less than 10 per cent of its retail customer base in India. HSBC said it will advise customers directly about the changes.
“Customers are encouraged to visit their local branch or call the bank’s call centre to find out more about how this impacts them,” it added.
The bank said its priority is to ensure that the changes are implemented in a manner which will minimise disruption to its customers and its staff.
In its investor presentation for the first quarter of 2016, HSBC said it will optimise its global network. The targeted outcome of this action by 2017 will be a reduced global footprint.
Stuart P Milne, Group General Manager and Chief Executive Officer, HSBC India, said, “This move aims to position our RBWM business for the future, with the right mix of digital versus physical branch distribution. Customer expectations are changing rapidly and we need to adapt accordingly.
“India is a priority market for HSBC and we will continue to invest to achieve sustainable growth by supporting the needs of our customers in Retail Banking and Wealth Management, Global Banking and Markets, and Commercial Banking, businesses where we have scale and a highly differentiated proposition.”
The HSBC spokesperson said a key priority is a fair treatment of the staff in the impacted branches and the bank will do everything it can to assist affected employees during the business transition. Redeployment opportunity will be accorded to the affected employees, he added.
Earlier this week, the Royal Bank of Scotland N.V. (RBS) said it would commence closing its retail banking branches in a phased manner and has started informing its customers. The foreign bank operates 10 retail bank branches across India.
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