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
ebooksA celebration of British elections
Arts and Entertainment
Billie Piper as Brona in Penny Dreadful
tvReview: It’s business as usual in Victorian London. Let’s hope that changes as we get further into the new series spoiler alert
Life and Style
A nurse tends to a recovering patient on a general ward at The Queen Elizabeth Hospital in Birmingham
health
News
Fans take a selfie with Ed Miliband in Kempston, near Bedford, on Tuesday
election 2015
Extras
indybest
Arts and Entertainment
No Offence
tvReview: No Offence has characters who are larger than life and yet somehow completely true to life at the same time spoiler alert
  • Get to the point
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

Ashdown Group: Editor-in-chief - Financial Services - City, London

£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Guru Careers: Project Manager / Business Analyst

£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

SThree: Trainee Recruitment Consultant - Swiss Banking and Finance

£20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...

Day In a Page

General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'
Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

Flesh in Venice

Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
11 best anti-ageing day creams

11 best anti-ageing day creams

Slow down the ageing process with one of these high-performance, hardworking anti-agers
Juventus 2 Real Madrid 1: Five things we learnt, including Iker Casillas is past it and Carlos Tevez remains effective

Juventus vs Real Madrid

Five things we learnt from the Italian's Champions League first leg win over the Spanish giants
Ashes 2015: Test series looks a lost cause for England... whoever takes over as ECB director of cricket

Ashes series looks a lost cause for England...

Whoever takes over as ECB director of cricket, says Stephen Brenkley
Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power