HONG KONG: HSBC saw pre-tax profit surge 32 percent year on year in the third quarter on the back of lower fines the banking giant announced Monday, but revenue dropped in the wake of Asian market volatility.
Group chief executive Stuart Gulliver said the performance was “resilient” but that revenue had been affected by stock market sell-offs in Asia, with revenue down four percent.
The Asia-focused lender announced in June that it would cut its global workforce by up to 50,000 and sell off its businesses in Brazil and Turkey as it seeks to cut costs. “Our cost-reduction measures are beginning to have an impact on our cost base,” Gulliver said, but added that there was “more to achieve”. The bank is also looking at possibly moving its headquarters away from Britain but said there was a “considerable amount of work still to do” before a decision is made.
“Whilst the target for completion of the review was initially set as by the end of 2015, this is a self-imposed deadline that can be moved should the Board require further work to be performed,” the report said.Adjusted operating expenses were up two percent year on year, partly due to investment in regulatory programmes and compliance, the report said.
HSBC was fined late last year by US and British regulators for attempting to rig foreign exchange markets. In February, it was forced to apologise for “unacceptable” failings at its Swiss division following allegations that the unit helped rich clients hide billions from the taxman.
It has faced a storm over claims that it helped clients from around the world dodge taxes on accounts containing 180 billion euros ($204 billion) between November 2006 and March 2007, in cases that are being investigated in several countries.
HSBC is also facing a French criminal probe over the affair. The rise in third-quarter pre-tax profits was partly due to lower fines and settlements, the report said. HSBC agreed in June to pay Geneva authorities 40 million Swiss francs ($40 million) to settle a money laundering investigation at its Swiss private bank.
