HONG KONG: HSBC has reported a rise in half-year profit as the bank hailed a strong performance across its main divisions. The banking giant said pre-tax profit rose 5% to $10.2 billion (€8.7 billion) in the first six months of the year, ahead of expectations. Reported revenue came in at $26.2 billion (€22.3 billion), down 12%. The firm also announced a $2 billion share buy-back as outgoing chairman Douglas Flint pointed to a multitude of factors behind the positive results. “Markets-based revenues benefited from market share advances, commercial banking customer activity was robust, wealth management and insurance revenues were notably stronger in Hong Kong, and credit experience globally remained remarkably sound.
“As central bank interest rates edged higher, led by the US, we began to benefit from improved margins on our core deposit bases, providing a welcome enhancement to the group’s revenue mix, given the likely trajectory of interest rates over the medium term,” he said. Mr Flint and chief executive Stuart Gulliver have been attempting to reinvigorate the bank since the financial crisis, after which it has faced a series of misconduct issues. Mr Gulliver has overseen stringent job cuts and asset sales as part of efforts to boost profits. “We remain on track to achieve around 6 billion US dollars of annualised cost savings by the end of the year, in line with the revised expectations that we set at our annual results. “In the past 12 months we have paid more in dividends than any other European or American bank and returned 3.5 billion US dollars to shareholders through share buy-backs. “We have done this while strengthening one of the most resilient capital ratios in the industry,” he added.
HSBC is one of a number of banks considering relocating jobs to the continent after the Brexit vote, having said that 1,000 jobs may have to move from London to Paris over the next two years depending on the outcome of negotiations. On Brexit, the firm added: “Notwithstanding uncertainties arising from increasing geopolitical tensions and ambiguous predictions around the shape of transition to, and final form of, the UK’s future relationship with its major trading partners in the EU, customer activity across all business segments was resilient.”
