HSBC Just Spent $68 Million to Push Out 134 of Its Most Senior Bankers

When a bank pays nearly $70 million just to say goodbye to people, it's usually trying to send a message.

New disclosures reviewed by the Financial Times show HSBC handed out roughly $67.5 million in severance last year to remove 134 of its highest-ranking employees — a group the bank internally classifies as "material risk takers," meaning executives and staff whose decisions carry enough weight to actually move the bank's overall risk profile. That's about 10% of that entire senior category, gone in a single year.

To put the scale in context: this is the largest senior-banker cull HSBC has carried out since the 2008 financial crisis.

The cuts sit squarely inside CEO Georges Elhedery's broader push to simplify Europe's largest bank. Since taking over, Elhedery has been steadily stripping out layers of management he considers redundant — a strategy he's described as removing "deduplication" across senior roles. As part of the same overhaul, HSBC has already shut down its equity capital markets advisory and mergers-and-acquisitions businesses across the US, UK, and Europe, freeing up roughly $1.5 billion to redirect toward areas where the bank believes it holds a genuine competitive edge.

It's not just investment banking taking the hit, either. A person close to the bank told the Financial Times the senior cuts reflect a "broader trend" running across HSBC as a whole, not something confined to one division. The bank has also been exiting entire markets and business lines this year — retail banking in Sri Lanka and Bangladesh, its life insurance arm in the UK, custody and fund administration operations in Germany, and its retained loan portfolio in France, among others.

HSBC isn't operating in isolation here. Nearly every major European lender has been trimming senior ranks over the past year — Santander cut 49 material risk takers, Deutsche Bank 48, BNP Paribas 39, and Barclays 32 — but HSBC's total significantly outpaces all of them combined for scale.

Severance costs varied widely by bank, too. Société Générale paid the highest average payout per departing senior banker at roughly €870,000, followed by Santander at €736,000 and Deutsche Bank at €437,500.

The logic behind spending tens of millions upfront isn't complicated, even if the price tag looks steep. Removing senior, high-salary positions today typically saves a bank far more in ongoing costs over the following years — severance is a one-time expense, but the salaries, bonuses, and overhead tied to senior roles recur annually. For a bank the size of HSBC, trading a short-term $68 million hit for hundreds of millions in future savings is, from a purely financial standpoint, a fairly straightforward calculation.

Elhedery indicated back in May that this phase of the restructuring was nearing its end. Whether that means the senior cuts slow down from here, or simply shift into a different part of the bank, remains to be seen.

Got a tip or breaking story for us? Reach out at tips@kanilprwire.com.