HSBC Malta had gone through “strategic considerations” prior to deciding to close down seven of its branches in Malta, and merge the Balzan and Qormi ones into one “flagship” branch in Qormi in 2020. Business Malta sits down for a one-on-one session with HSBC Malta CEO Andrew Beane after the announcement, who insists that role reductions will happen on a voluntary basis, ensuring that the bank will work toward keeping staff in the organisation if they intend to stay.
Mr Beane says that the closure of the branches comes after the local board had spent quite some time analysing the changing behaviour of HSBC Malta customers, as well as the emerging technological solutions reshaping the banking industry globally — one vertical of many, if not all, that is being upturned by connectivity on the go and top-notch tech at our fingertips.
“Customers are leading different lives. People are now globally doing 80% of their transactions digitally. In Malta, this translates to a 60% year-on-year increase, and a 10% year-on-year decrease in traditional transactions. You have to organise your business around that,” Mr Beane tells Business Malta. In fact, HSBC Malta has recently revamped its mobile application, launched a new internet banking platform and has streamlined the onboarding process of new customers.
Despite technology storming into industries and forcing businesses to rethink operations at their core, the HSBC Malta CEO says that branches will not go extinct in the future. “It is not our vision that banks will become totally digital. Actually, I think successful banks will be a blend of the best of digital and the best of human beings. Branches will remain important.”
“We have looked at the range of services that we want to offer and we have looked at the cost that we can afford to invest in them. This is a considered strategic decision by the local board.”HSBC Malta CEO Andrew Beane
Nevertheless, he insists HSBC Malta envisages a banking landscape offering a fine balance between more digital services and less — but more efficient — physical branches.
“The branches that we have will be different; I genuinely believe in a better way for customers and colleagues. There will be a number of roles that we will reduce, but that will be on a voluntary basis; which means that it is subject to discussion with the Malta Union of Bank Employees [MUBE], which we can only start now,” according to the CEO.
“It is about having better branches, but less of them in an absolute sense. What you will see when you see our flagship branch in Qormi next year that it will be different with more services and more flexibility. I think it will have a better customer experience to it. So it is not as simple as saying some branches are closing, actually it is about building a sustainable model for the future,” Mr Beane adds.
Keeping staff in house
Closures always create inflated headlines, especially in business news. While such news can easily cause concern among investors, it can also jolt staff working at the closing-down facilities into insecurity about their future. Still, Mr Beane tells Business Malta that HSBC is negotiating with MUBE, and is ready to assist staff through this period.
“Colleagues, if they are interested in, applying for early retirement can do so. No one will be asked to do what they do not want to. If somebody works in an area that is changing and they do not want to do that, we would work with them to allocate them for a new job in the organisation,” the HSBC Malta CEO says.
When asked whether the bank would consider training colleagues to fill new roles in the organisation, the CEO did not sweep the idea off the table. “We are delighted to work with people and teach them new skills and help them grow and flourish as individuals.”
Nevertheless, the CEO did not give a figure on how many people might be affected in the seven branches that are closing down — as the Balzan branch is said to be merging with a “flagship” branch being established in Qormi.
“We have only just started the negotiation with the union and we want to respect their opinion. At the same time, as I mentioned before, the programme will be voluntary” and at this point, it is yet unclear what the intentions of staff will be.
When asked whether it is coincidental that HSBC Malta’s announcement of closing branches comes after the Financial Times reported that HSBC could be laying off 10,000 people globally, Mr Beane insisted that the decision was a local one.
“This is a decision that the board has been thinking about for some time. One of the board’s roles is to look at the macro trends that are changing the way that the customers behave. We have looked at very carefully how digital trends that we have seen in other countries are now affecting Malta,” Mr Beane says.
“We have looked at the range of services that we want to offer and we have looked at the cost that we can afford to invest in them. This is a considered strategic decision by the local board,” Mr Beane concludes.
In a recent editorial, the Financial Times says that it appears to be in the HSBC group’s “DNA to be ahead of the curve” in crucial decisions players of the banking sector would need to make related to changing customer behaviour and changing economic trends. “All of that comes on top of slowing global growth and the mounting pressure on lending margins from looser monetary policy,” the Financial Times editorial says.