HSBC is exiting M&A advisory and equity capital market activities in the UK, the rest of Europe and the Americas as part of a major shake-up of its investment bank as CEO Georges Elhedery continues to streamline operations and cut costs.

“As part of our ongoing efforts to simplify HSBC and increase leadership in our areas of strength, we are finalising a review of our investment banking business," a spokesperson for the bank said.

"We will retain more focused M&A and equity capital markets capabilities in Asia and the Middle East and will begin to wind down our M&A and equity capital market activities in the UK, Europe and the US.”

HSBC, Europe's biggest bank, intends to shift to "a more competitive, scalable, financing-led model", according to a memo to staff, Reuters reported. The memo said the bank will keep is debt capital markets and leveraged acquisition finance operations globally.

Elhedery took over as CEO at the start of September and has made sweeping changes to strategy, structure and leadership and is trying to slash costs. He created a new corporate and institutional banking business led by Michael Roberts that will draw its investment bank closer to its commercial bank and in December appointed Adam Bagshaw as global head of investment banking.

Elhedery's plan will see HSBC operate through four businesses that reflect its core strengths – Hong Kong; the UK; corporate and institutional banking; and international wealth and premier banking. He wants to free those areas from HSBC's past complex and bureaucratic structure.

It extends a long-term shift by the bank to Asia and the Middle East, where it is one of the leading commercial and investment banks. But it has long faced a challenge of how much of an investment bank to keep in other markets, notably the UK and the US, where Asian of Middle East clients might want to trade or raise funds.

Source: IFR HSBC exits M&A and ECM in Europe, Americas | IFR