HSBC Holdings is set to award some investment bankers and wealth managers little or zero bonuses as Europe's largest bank adopts a tougher American-style approach to compensation, according to reporting from Bloomberg.

The lender plans to encourage underperforming staff, including some managing directors, to leave following bonus payments in the coming weeks. No final decisions have been made, the report said.

The move reflects chief executive Georges Elhedery's ambition to align HSBC more closely with Wall Street pay practices. "We are committed to ensuring our employees are rewarded competitively, with a focus on differentiation determined by performance, to attract and retain talent," a bank representative said.

HSBC's overall bonus pool remained flat at $3.8 billion in 2024, defying an industry-wide trend of rising payouts. Staff in the corporate and institutional banking division were warned to expect lower rewards.

The 160-year-old institution is midway through a sweeping restructuring under Elhedery, who took charge in September 2024. He has closed most US, UK and European deals and equity underwriting operations whilst merging the commercial and investment banking divisions. The overhaul has prompted the departure of several senior executives.

Elhedery has said the reorganisation, targeting $3 billion in savings, aims to create a "simpler, more dynamic and agile organisation". However, the effort has increased costs, with the cost-to-income ratio rising to 49.9 per cent in the first half of 2025 from 43.7 per cent a year earlier.

Investors have backed the strategy. HSBC's share price has nearly doubled since Elhedery's appointment, though it has trailed gains at Barclays and Standard Chartered. The bank remains Europe's largest financial institution with a market capitalisation of roughly £225 billion, ahead of Banco Santander, UBS Group and BNP Paribas.

HSBC, founded in Hong Kong in 1865, has deepened its Asian focus in recent years whilst expanding in the Middle East. The bank is exploring options for its Singapore insurance unit, which would follow disposals including its UK life insurance business sold to Chesnara, its German custody and private banking operations, and its French life insurance division.

The lender is scheduled to report full-year 2025 results this month.

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