HSBC Shifts Compensation to Performance-Based Bonus Model

HSBC is restructuring its global compensation model to prioritize performance-based pay by increasing the proportion of bonuses relative to base salaries and phasing out role-related allowances. The bank is moving toward an "eat what you kill basis" for bonuses, specifically targeting senior bankers classified as material risk takers in its investment bank.

Financial data from 2023 to 2025 shows that fixed pay for these material risk takers fell 7.5% to $584,000, while their bonuses rose 6% to $819,000. In contrast, median combined bonuses and benefits for staff in the United Kingdom fell from £17,500 in 2023 to £11,700 last year, although median salaries in that region rose to £58,000.

The bank is also cutting various employee perks. However, existing senior bankers in Hong Kong will retain school fee benefits, and allowance cuts for senior staff will not take effect until 2028.