HSBC pre-tax profit up 32% at $6.1 bn
02 November 2015
HSBC Holdings Plc, Europe's largest lender, reported a better than expected 32-per cent rise in pre-tax profit for the third quarter, helped by lower costs and litigation charges that helped offset the impact of a slowdown in Asia and a jump in regulatory spending.
The bank reported a profit of $6.1 billion for the three months ended 30 September against a profit of $4.6 billion in the year-ago quarter.
Adjusted profit for the quarter was down 14 per cent at $5.5 billion, on account of lower fines and a gain from the sale of its stake in Industrial Bank.
HSBC's third quarter revenue slipped 4.4 per cent to $15.1 billion, while pretax profit rose to $6.1 billion from $4.6 billion a year earlier. That, however, was offset by lower costs and litigation charges.
London-based HSBC said its operating costs fell 19 per cent to $9 billion from a year earlier benefitting from a $1.4 billion decline in fines, settlements and redress for UK customers.
HSBC, however, continues to grapple with declining revenue and reported $2.2 billion spending on regulation and compliance in the first nine months of the year, up 33 per cent year on year.
The bank, under chief executive Stuart Gulliver had, in June, unveiled a three-year plan to trim its global network, shut money-losing businesses and eliminate as many as 25,000 jobs after compliance costs surged.
In April HSBC had proposed to shift its head quarters out of London despite the British government's promise to take a more accommodative stance towards the industry (See: HSBC mulling moving out of UK).
The bank, now says it needs more time to determine whether to move its headquarters from London
HSBC's shares were down 0.6 per cent at 504 pence on the London market at 0810 GMT, broadly in line with a weaker European bank index .
The shares have fallen 17 per cent this year on concerns over slowing Asian growth, its main revenue source.