Sunday, October 2, 2022

HSBC first-quarter pretax profit falls 19 percent; beats estimates

HSBC first-quarter pretax profit falls 19 percent; beats estimates

LONDON - HSBC Holdings Plc on Thursday reported a 19 percent fall in first quarter profit, as Europe's biggest bank battles to restore flagging revenues following its restructuring.

HSBC said pretax profit for the first three months of the year fell to $5 billion, down from $6.1 billion a year ago and better than the $4.3 billion average of analysts' estimates compiled by the bank.

The profit decline was due to a change in the accounting treatment of the fair value on its debt and as year-ago earnings included the operating results of the Brazil business that it sold in July, it said.

Revenue in the quarter dropped 13 percent to $13 billion. The bank said it completed its $1 billion share buy back in April, after which its common equity tier 1 ratio - a measure of its financial strength - was 14.3 percent.

Chief Executive Stuart Gulliver said in a statement the bank had now exceeded the risk-weighted asset reduction target that it set in 2015 and would continue to remove low-return risk-weighted assets.

Shareholders at the bank's annual general meeting last week overwhelmingly voted in favor of reelecting Chief Executive Stuart Gulliver to the lender's board, in an affirmation of his strategy in recent years to shrink and refocus the bank.