(Bloomberg) -- Europe needs to revert to “normalized monetary economics” as the current policies don't work for banks, according to Noel Quinn, acting Chief Executive Officer of HSBC Holdings Plc.
“It's very hard to run a financial institution in an environment of negative interest rate,” Quinn said on the opening day of the Future Investment Initiative summit in Saudi Arabia -- an annual jamboree that showcases the kingdom's ambitions. “Europe particularly has challenges and I can't see a ready solution for that in the next year or two or three.”
Job cuts announced by banks this year were approaching 60,000 last month, almost all of them in Europe, where negative interest rates and a slowing economy prompt lenders, including Germany's Commerzbank AG, to step up cost reductions.
HSBC on Monday embarked on its biggest overhaul in years after profit missed estimates, warning that it will pare back underperforming operations in the face of slowing economic growth and geopolitical uncertainty.
Read more: HSBC Warns of Writedown, Job Cuts as Profit Misses Estimates
“I'm struggling to find the path out for European financial services,” Quinn said. “We need to revert back to more normalized monetary economics and use fiscal measures more. I don't think there's an appetite or a political appetite to do that. Europe is a challenged geography.”
--With assistance from Farah Elbahrawy.
To contact the reporter on this story: Dinesh Nair in London at dnair5@bloomberg.net
To contact the editors responsible for this story: Stefania Bianchi at sbianchi10@bloomberg.net, Claudia Maedler
©2019 Bloomberg L.P.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
