Malta is among the smaller HSBC operations that HSBC Holdings Plc chief executive officer John Flint and chairman Mark Tucker are considering pulling out of, according to Bloomberg.
The agency said that sources familiar with the discussions said Flint and Tucker were reviewing as many as a quarter of the 67 countries in which the bank operates. The options are to exit or sell "smaller consumer operations such as Bermuda, Malta and Uruguay.
A spokeswoman for HSBC declined to comment to Bloomberg beyond saying that the bank would update investors at or before its first-half earnings.
The Malta operation is still profitable but has been facing increasing pressure. Profit before tax for 2017 was €49.8 million, a decrease of 19.9% when compared to the 2016 results.
Malta Union of Bank Employees' president William Portelli - in between calls from worried employees - pointed out that this was not the first time that the group had reviewed its scope of operations. However, in the past, mentions of Malta turned out to be speculative. We have to wait and see what happens. We will clearly monitor any developments, as is standard practice for the union.
"Assurances will be sought but at this stage there is no cause for alarm."
Contacted for comment, an HSBC Bank Malta spokesman said it "did not comment on rumour or speculation".
HSBC Bank Malta CEO Andrew Beane had said in the annual report: "In 2017, the bank made significant progress with changes to its business model in order to meet the
highest global standards for compliance and risk management. While these actions reduced profitability during the year due to lower revenues and higher costs, the actions taken have materially strengthened the bank’s risk profile and positioned it well for the future."
The adjusted return on equity was 11.7%, down from 13.1% in 2016. The local
group targets a return in the medium term of 10%.
The HSBC Group has more than 229,000 employees working across the world, serving 38 million customers. In Malta, it employed 1,378 people in 2017.
HSBC had controversially acquired Mid-Med Bank in 1999 for the equivalent of €191 million.