HONG KONG, Sept 26: Banking giant HSBC is to cut 1,100 jobs worldwide because of the volatile global financial environment, a spokesman said on Friday.

The cuts will be made in the global banking and market division, with around half of those losing their jobs in HSBC’s British operations, Hong Kong-based spokesman Gareth Hewett said.

“The steps we have taken today are in the light of the current global business and economic environment and our cautious outlook for 2009,” he said in a statement.

“Markets continue to be challenging and difficult but our strategy leaves us well positioned for the next wave of global growth, when it comes.”

Around 100 jobs will go in Hong Kong. The jobs would be cut in both front and back office operations, Hewett said.

The statement said that global pre-tax profits for the division were 2.7 billion dollars in the first half of 2008, down 35 per cent over the first half of 2007 but 37 per cent higher than in the second half of 2007.

HSBC employs around 330,000 people worldwide. The global banking and market division includes investment banking, treasury and trading operations.

Global markets have been in the doldrums for the past year over worries about access to credit, stemming from the dire state of the US housing market and unwise lending.

The situation has worsened in the past two weeks as major financial institutions have required government-backed rescue packages, and investment banking giant Lehman Brothers was forced into bankruptcy.

HSBC was one of the first banks to warn of the problems among products linked to the high-risk US mortgage sector. The British-based bank’s US division has suffered diminishing profits as a result of the credit crisis.

Last week, the bank said it had scrapped a six billion dollar deal to buy a major South Korean bank after the financial crisis cut asset values worldwide.

HSBC said it had terminated the deal to buy a 51 per cent stake in Korea Exchange Bank (KEB) from US buyout fund Lone Star, “taking into account all relevant factors, including current asset values in world financial markets.” —AFP