Financial Turmoil Hits HSBC

HSBC has just announced that it is to axe 1,100 jobs worldwide, blaming the credit crunch for the decision. HSBC employs about 335,000 people globally.

Unfortunately, about half of the cuts will take place at its global banking and markets operation in London at Canary Wharf.

Last month HSBC’s half year profits dropped by 28% to $10.2bn, due to a $14bn to write-off of bad debts in the US, and asset write-downs.

Financial institutions around the world have been coming under increased pressure from the current turmoil on the markets.

The problems have forced governments to intervene and shore up money markets. Earlier this year, the UK government was forced to purchase Northern Rock, while in the US lenders Fannie Mae and Freddie Mac had to be rescued from collapse.