HSBC Bank Malta plc – Cost Reduction Programme Update

January 7, 2016
|In Company Announcements
|By Jesmond Mizzi Financial Advisors

HSBC Bank Malta p.l.c. issued the following Company Announcement pursuant to Malta Financial Services Authority Listing Rules: 

COST REDUCTION PROGRAMME 

 

Reference is made to the company announcement HSBC278 issued on 26 November 2015 concerning the improvement of the Bank’s productivity and cost effectiveness.

 

As per the announcement, the board of the Bank has now approved a plan to deliver sustainable cost savings in a context of higher operating costs and a decline in profitability, mainly through an early retirement scheme for employees. This scheme is one of a number of initiatives aimed at improving the Bank’s productivity and cost effectiveness, while streamlining its operations and investing in areas of growth and in compliance.

 

Following a comprehensive review of the applications received for voluntary retirement the Bank intends to accept around 130 applications. The estimated cost of this one-off expenditure is approximately €14.7m which will enable the Bank to reduce annual operating costs by approximately €4.4m. The entire cost for the voluntary retirements will be provided for in the financial year ended 31 December 2015 and is expected to result in a one-time reduction in the Bank’s profitability for that financial year. However, the cost reductions are expected to enable the Bank to achieve a higher level of profitability and efficiency in future years.

 

The Bank remains confident in its ability to grow its business in Malta and support the local economy and its customers, while creating value for its shareholders.

 

To view the official Company Announcement, click here.