HSBC has announced it stripped out $1.2 billion (£890 million) in costs in 2025, largely by cutting its senior management team, while simultaneously hiking staff bonuses by 10 per cent.
The global banking giant is undertaking a “sprawling simplification programme” with structural changes, aiming for greater “agility”.
Under chief executive Georges Elhedery, who took the helm in 2024, the bank targeted $1.5 billion (£1.1 billion) in annual cost reductions by 2026. However, HSBC revealed on Wednesday it now expects to achieve this by the end of June – six months ahead of schedule.
Mr Elhedery said that a large amount of the savings, including the $1.2 billion identified last year, stemmed from the “deduplication” of jobs within the group, particularly among senior positions.
He said this resulted in a net 15 per cent reduction of managing director positions, which has not had any impact on the group’s revenues.
Meanwhile, HSBC revealed that it handed out bonuses worth $3.9 billion (£2.9 billion) to its eligible staff during the year – a 10 per cent increase compared with 2024.
The bank said it ensured its “highest performers had the strongest variable pay outcomes compared to the prior year”.
Mr Elhedery took home a pay packet of £6.6 million in 2025, made up of his salary and benefits, plus an annual bonus and long-term incentive award of about £4.8 million.
HSBC’s pay committee said it intends to grant the chief executive the maximum long-term incentive award worth 600 per cent of his salary, which amounts to £9 million, for 2026-28.
The value will be subject to the bank’s performance over the next three years, and delivered in instalments.
HSBC said it was striving to create a “high-performance culture” where staff are better rewarded for work that boosts the performance of the bank.
Nevertheless, it reported lower earnings for 2025, with its pre-tax profit down about 7 per cent year-on-year to 29.9 billion dollars (£22.1 billion).
This took into account the impact of losses related to its stake in the Chinese Bank of Communications, and restructuring costs from its simplification programme.
Shares in HSBC were up by about 6 per cent in early trading on Wednesday.
