With many industry analysts predicting weak profitability for the finance sector this year, global financial giant HSBC has begun scaling back its operations. The bank is exiting several global markets and shutting down some of its services in favour of prioritising wealth management in the Middle East and Asia.
Multiple Market Exits as Part of Operational Overhaul
Earlier this week, HSBC announced it would be closing several of its investment banking businesses in the United Kingdom, Europe, and the Americas, shifting its focus towards wealth management services in other regions.
“It was just a very tough job to build up to a level where [HSBC] has a competitive edge. Continuing to try to ‘break in’ to those markets would not be the best use of the bank’s resources,” HSBC stated in a memo obtained by the Financial Times.
The financial giant noted that this decision is part of a broader effort to simplify internal operations and focus on its core strengths.
Additionally, this move aligns with HSBC’s previously announced plans to review its retail banking operations in Indonesia and Mexico. The bank is reportedly considering a significant reduction in retail operations in Mexico, while also evaluating its presence in Malaysia and Indonesia to capitalise on high-value banking opportunities.
Goodbye to ‘Zing’
HSBC has also shut down Zing, its money transfer app, in an effort to compete more effectively with fintech firms such as Wise and Remitly. The decision comes after a strategic review of Zing’s performance within HSBC’s long-term outlook.
“Following a strategic review within the HSBC Group, we have decided to close Zing and integrate its underlying technology platform into HSBC,” a company spokesperson told Banking Dive.
They added:
“This decision is part of the simplification of the Group announced in 2024, focusing on increasing leadership and market share in areas where we have a clear competitive advantage and the greatest opportunities to grow and support our clients.”
Launched in January 2024, Zing initially targeted HSBC and non-HSBC customers in the United Kingdom, with plans for expansion into new markets. However, HSBC has now stopped accepting new applications, and existing users must withdraw their funds before 2 April, when the service will officially shut down.
While HSBC has not disclosed how many employees will be affected by the closure, reports estimate that approximately 400 jobs may be at risk.
Why Focus on the Middle East and Asia?
HSBC’s strategic shift towards the Middle East and Asia follows a major organisational restructuring under CEO Georges Elhedery, who divided the bank’s global operations into ‘East’ and ‘West’ to cut costs and navigate the complex geopolitical landscape that frequently impacts financial services.
In an internal interview, David Liao and Surendra Rosha, co-CEOs of HSBC’s Asia and Middle East operations, explained the rationale behind the shift:
“These regions are home to some of the world’s most powerful economies. Their deepening connectivity through multilateral trade pacts and institution-building efforts in areas like cross-border data sharing present significant opportunities for growth.”
They continued:
“The opportunity is clear, but so is the challenge. Many Asian countries have high savings rates and lower household consumption compared to the shopping- and services-centric models seen in much of the developed world. The trick will be rebalancing these ratios—spreading more wealth among middle-class consumers while continuing to invest in infrastructure, public services, and clean energy.”
HSBC also highlighted that these regions host significant capital pools, particularly in China, Japan, Korea, and the Gulf States. Meanwhile, international financial hubs in Singapore, Dubai, and Hong Kong further strengthen the sector.
With this pivot, HSBC aims to position itself as a dominant player in wealth management across Asia and the Middle East, maximising returns in fast-growing economies while simplifying its global banking operations.
