HSBC has announced that it will restructure its advice arm, putting 1,149 jobs at risk, according to New Model Adviser.
The bank will scrap its commercial financial adviser division, merge its advisers into its consumer retail banking business and cut 942 relationship managers who do not give advice. It will be left with a diploma-qualified advice force of 853 people.
The bank will keep its current charging structure:
Assets up to £75,000: £950 upfront charge
£75,001 to £150,000: 1.3 % upfront charge and max charge of £1,500
£150,001 to £500,000:1% and max charge of £4000
£500,001 to £1 million: 0.8 % and max charge of £6500
£1 million to £3 million: 0.65%
Customers who already hold £50,000 of savings and investments with the bank will have a relationship manager qualified to give financial advice as a single contact for both their banking and financial advice needs.
Antonio Simoes, head of UK Bank and deputy chief executive of HSBC Bank, said the changes were part of a step away from a sales-based approach and aimed at improving its culture to serve customers.
‘Better serving our customers, particularly for their wealth management needs, is essential if we are to fulfil our aspiration of becoming the world's leading international bank,” he told New Model Adviser.
‘These proposals, together with the recent removal of all sales targets for our employees and the complete decoupling of incentives from those sales, mean our customers can expect us to fully focus on serving their needs and do the right thing. Evolving and improving our culture will take time but the changes announced today are another step in the right direction.’
In April 2012 HSBC cut 650 tied advisers, but said it would keep its 400-strong whole of market IFA arm for high-net-worth clients.
According to the Daily Telegraph, Douglas Flint, chairman of HSBC said the industry was moving towards serving high-net-worth clients. However, less wealthy customers could lose access to simple financial services if lenders are overburdened by unnecessary regulation.
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