HSBC announce 10% profit growth despite drop in revenues

 

Banking giant HSBC announced today that first-half year profits grew 10 per cent on the previous year to 14.1 billion US dollars (£9.2 billion) on lower bad debts and shrinking costs.

The banking group's announcement came after a year of cost cutting measures. 

Profits in its UK retail banking arm increased by 58 per cent to 804 million US dollars (£524 million).

The bank said it lent £7.1 billion of new mortgages to 68,000 homebuyers during the first six months of the year.

Profits in its UK business banking arm swelled about 190 per cent to 894 million US dollars (£582 million).

However, shares in the bank fell more than two per cent as the earnings haul disappointed City hopes for pre-tax profits of around 14.5 billion US dollars (£9.5 billion).

Revenues fell by seven per cent to 34.4 billion US dollars (£22.4 billion) amid shrinking income in North America and Latin America.

HSBC Chief executive Stuart Gulliver shrugged off "muted" global growth and said the bank is well-placed to benefit from long-term trends in the global economy.

He said: "Despite slower growth in the short term, the long-term economic trends remain intact.

"The global economy will continue to rebalance towards the faster-growing markets and trade and capital flows will continue to expand."

HSBC has been heavily reducing costs under Mr Gulliver's watch since his appointment in 2011, including selling or closing 54 businesses and cutting more than 40,000 jobs. The bank expects total staff numbers to eventually fall to 254,000.

The banking group generates an estimated 90 per cent of its money from outside of the UK and has benefited from being exposure to emerging markets in Asia.

The lender, the last of the major UK high street banks to report on first-half trading, swung back into the black in the UK with first-half profits of £2.2 billion.

But HSBC set aside another 367 million US dollars (£239 million) to compensate customers mis-sold payment protection insurance, taking HSBC's total bill for the mis-selling scandal to £1.8 billion.

The bank reported pre-tax losses of 3.4 billion US dollars (£2.3 billion) in the UK a year earlier, weighed down by the cost of mis-selling claims and a money-laundering scandal in the US.

The bank said first-half underlying operating costs were down 8 per cent to 18.3 billion US dollars (£11.9 billion) year-on-year.

Provisions for bad debts also fell 29 per cent to 3.1 billion US dollars (£2 billion).

Additional reporting by PA

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

SThree: Talent Acquisition Consultant

£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...

Day In a Page

John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Forget little green men - aliens will look like humans, says Cambridge University evolution expert

Forget little green men

Leading evolutionary biologist says aliens will look like humans
The Real Stories of Migrant Britain: An Algerian scientist adjusts to life working in a kebab shop

The Real Stories of Migrant Britain

An Algerian scientist struggles to adjust to her new life working in a Scottish kebab shop
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy
UK heatwave: Temperature reaches 39.8 degrees on Central Line - the sweatiest place in London

39.8 degrees recorded on Tube

There's hot (London) and too damn hot (the Underground). Simon Usborne braved the Central line to discover what its passengers suffer
Kitchens go hi-tech: From robot chefs to recipe-shopping apps, computerised cooking is coming

Computerised cooking is coming

From apps that automatically make shopping lists from your recipe books to smart ovens and robot chefs, Kevin Maney rounds up innovations to make your mouth water
Jessie Cave interview: The Harry Potter star has published a feminist collection of cartoons

Jessie Cave's feminist cartoons

The Harry Potter star tells Alice Jones how a one-night stand changed her life
Football Beyond Borders: Even the most distruptive pupils score at homework club

Education: Football Beyond Borders

Add football to an after-school homework club, and even the naughtiest boys can score
10 best barbecue books

Fire up the barbie: 10 best barbecue books

We've got Bibles to get you grilling and smoking like a true south American pro
Wimbledon 2015: Nick Bollettieri - Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power

Nick Bollettieri's Wimbledon Files

Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power
Ron Dennis exclusive: ‘This is one of the best McLaren teams ever – we are going to do it’

‘This is one of the best McLaren teams ever – we are going to do it’

Ron Dennis shrugs off a poor start to the season in an exclusive interview, and says the glory days will come back
Seifeddine Rezgui: What motivated a shy student to kill 38 holidaymakers in Tunisia?

Making of a killer

What motivated a shy student to kill 38 holidaymakers in Tunisia?
UK Heatwave: Temperatures on the tube are going to exceed the legal limit for transporting cattle

Just when you thought your commute couldn't get any worse...

Heatwave will see temperatures on the Tube exceed legal limit for transporting cattle
Exclusive - The Real Stories of Migrant Britain: Swapping Bucharest for London

The Real Stories of Migrant Britain

Meet the man who swapped Romania for the UK in a bid to provide for his family, only to discover that the home he left behind wasn't quite what it seemed
Cheaper energy on the way, but it's not all sunshine and rainbows

Cheaper energy on the way, but it's not all sunshine and rainbows

Solar power will help bring down electricity prices over the next five years, according to a new report. But it’s cheap imports of ‘dirty power’ that will lower them the most