HSBC $HSBA (-3,37%) has been making massive staff cuts at its digital asset management company Pinnacle in China since Thursday, according to a report by Reuters. The workforce is to be reduced by almost half - around 900 employees.
This decision marks a clear departure from the bank's previous expansion plans for its China activities.
Pinnacle, a digital platform launched in 2020, offers insurance and fund products on the Chinese market.
At the end of June last year, the platform employed around 2,100 people in its two main business areas. This figure is based on company information and official business documents, according to the report.
The headcount reduction at Pinnacle highlights the challenges that the Asia-focused HSBC faces in its efforts to grow and become profitable in China, the report added.
The move comes at a time when the bank is also implementing cost cuts elsewhere to boost its returns.