'We recognize that the world has changed and we need to change with it'.
HSBC will cut costs by as much as $5 billion within two years, laying off as many as 25,000 staff, the banking behemoth has told investors in a much-anticipated update.
In a statement to the Hong Kong Stock Exchange, HSBC also said that it would shrink its risk-weighted assets by about $290 billion, including cutting its global banking and markets risk-weighted assets to less than a third of the group's assets.
The bank also put off giving an update on where it will be headquartered until later in the year.
In Tuesday's announcement HSBC said that it intended to sell its Turkish and Brazilian operations, although it will maintain a presence in Brazil to serve big clients.
The closures in Brazil and Turkey would result in 25,000 new job cuts, the bank revealed following its statement. In a cost-cutting purge that started in 2011 HSBC cut about 40,000 people from its workforce.
The bank plans to accelerate its investments in Asia, singling out the Pearl River Delta in Guangdong province, China, and the ASEAN region as particular hotspots. It said it would expand its asset management and insurance businesses in Asia "with the aim of capturing expected opportunities from emerging wealth in the region".
The bank will target a return on equity of more than 10 percent by 2017, down from a previous target of 12 percent to 15 percent by 2016.
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In the statement, Stuart Gulliver, HSBC chief executive, said: "We recognize that the world has changed and we need to change with it. That is why we are outlining the following ten strategic actions that will further transform our organisation".
This is Gulliver's second attempt in just four years at seriously reforming the bank. In the past year HSBC has weathered allegations that its Swiss private bank helped of wealthy clients to evade tax. The 150-year-old financial institution is also is midway through a deferred prosecution agreement with the U.S. over accusations it helped launder money for drug cartels and clients from Iran.
King Lip, chief strategist at Baker Avenue Asset Management, told CNBC that the strategy change was "a start" but was not enough to move the stock.
"The moves to close Brazil and Turkey were pretty much widely expected so a significant catalyst should be something like spinning off the Asian or U.K. businesses, or if they close other divisions that are money-losing like the U.S. and perhaps even Mexico," Lip said.