APS blasts ‘evil machinations’ behind HSBC job cut claims

APS has forcefully denied allegations it planned mass layoffs as part of a potential takeover of HSBC Malta, dismissing the claims as “lies” and “evil machinations” following its surprise withdrawal from the deal.

APS pulled out of the race to take over HSBC on Thursday night, after the global banking giant announced its possible Malta exit last September. Within days, APS had emerged as the main contender. 

Speculation is growing over what led to the APS decision, especially after it cited “confidential information external to the due diligence exercise that caused the bank to reconsider its participation in the sale process”. 

From the start, rumours swirled that the Finance Minister was less than thrilled at the prospect of an APS takeover, instead pushing for a foreign bank to step in to fill HSBC’s shoes.

Clyde Caruana hinted at this last month, telling Times of Malta that Malta needs “more banking competition than exists today, not less”.

APS’ bid faced similar scepticism from financial experts, many of whom questioned whether the European Central Bank would even sanction a deal that would see Malta’s banking ecosystem narrow.

Sources who spoke to Times of Malta claimed that half of HSBC’s 945 local employees could have faced job cuts if the deal had gone through. They added that the potential mass layoffs caused great concern among high-ranking Church officials, including the archbishop himself. 

At a meeting held between APS and HSBC on April 10, which also featured the majority shareholder, HSBC Continental Europe, APS officials allegedly presented their plans for “market consolidation”. 

In practice, this refers to how the two companies’ resources, including their staff complement, would merge if a deal were to be struck. But replying to questions from Times of Malta, an APS spokesperson insisted that job cuts were not on the cards, let alone discussed at the meeting.

In a “categorical and unequivocal” reply, APS described the job loss claims as “lies” and “evil machinations”.

“In our meeting with HSBC Bank Malta plc of last week there was absolutely no reference or discussion to staff consolidation, and the matter wasn’t even remotely mentioned,” the spokesperson said.

On the contrary, the spokesperson added, APS “only had words of the highest reassurance to the HSBC management present,” in response to HSBC raising the issue of “prevailing uncertainty amongst the staff”. 

“From our very first conversations with Archbishop Scicluna about this potential transaction, he always stressed with the APS Bank board and management that there are to be no redundancies. We gave him that commitment and remain 200% loyal to it.

"All our considerations and evaluations have always taken that as a given and it was never a subject of any discussion”, the spokesperson said.

APS itself employs around 700 workers. 

But by Thursday morning, it became exceedingly clear that APS's bid did not enjoy broad support. Later, the bank issued its fateful statement saying it was “regrettably withdrawing” from the bidding process.   

APS’s withdrawal from the race leaves Hungarian bank OTP and a local business consortium as the two known bidders, although other names are likely to emerge as bidders close in on a deal.