HSBC in Crisis Mode? Swiss Wealth Unit Bleeds Talent, Slashes Ties with Billionaires

HSBC's Swiss private bank is navigating one of its most delicate moments in years, and the response is starting to show. After months of departures including interim head John Shipman, who left last month for Barclays Plc the bank is quietly lifting compensation for select staff in what could be a defensive move to keep competitors from poaching talent. People familiar with the matter said the pay boosts include relationship managers, a group that often becomes the first target when wealth units hit turbulence.

Behind the scenes, HSBC is pulling in senior reinforcements. Samir Assaf, the chairman of its Middle East business and an adviser to the bank's leadership, has been spending time in Geneva to help steady the operation. The bank, which has said its strategy is to significantly grow its Wealth business, recently promoted Daniel Calado to lead the Swiss unit on an ad interim basis after Shipman's exit. All of this comes as the Swiss arm is in the process of ending relationships with more than 1,000 wealthy Middle Eastern clients some with over $100 million in assets according to earlier Bloomberg reporting, a shift that could be reshaping the entire franchise.

Regulatory pressure is also building around the edges. The Swiss watchdog Finma previously found due-diligence lapses on high-risk accounts tied to politically exposed persons, and Swiss federal prosecutors have opened a probe into the division. In moments like these, retention packages often become a stabilizing tool the same playbook UBS used when it handed out about $500 million to key Credit Suisse staff after announcing their merger. HSBC's version could be an attempt to safeguard its bench while navigating a revamp that may still have several moving parts.