Cost-cutting HSBC set to axe another 1200 workers

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The cuts are set to come in back-office and support services as opposed to the frontline branch network.

They will be spread across the country with between 150 and 200 Londoners likely to lose their jobs.

Staff were told about the cuts this morning with a processing centre in leamington Spa and call centre in Newport, Gwent set to close completely.

HSBC cut 500 jobs across the UK last November and took out another 1100 posts in its global banking and markets business in September.

UK managing director Paul Thurston said: "The operating environment for banks in the UK is extremely challenging and will remain so.

"There are difficult decisions that have to be made as we adapt to a new environment and ensure we are positioned for the future. We deeply regret that these have led to the announcement of redundancies."

Rival Barclays has shed around 4500 jobs this year while nationalised banks Royal Bank of Scotland and Lloyds Banking Group are expected to cut thousands of jobs this year.

"HSBC, like all banks, must be thinking it's going to be a tough year and looking at ways to make savings," said Leigh Goodwin, analyst at Fox-Pitt Kelton. "The bank has always been very cost conscious."

HSBC has avoided taking state aid from the government and is in the middle of a £12.9 billion rights issue to boost its capital ratios and drive expansion in the Far East.

The rights issue at 254p a share has been fully underwritten and was last week approved by shareholders. Today the shares rose 1¼p to 392½p.