HSBC results: investment bank gains see first quarter profit rise 4% to $7.1bn

Shares moved higher on the news

Shares in Europe's largest bank erased earlier losses and moved higher on the news (Reuters)

HSBC posted a first quarter profit up 4 per cent at $7.1 billion following gains in investment banking.

The positive results surprising analysts and investors after a rocky two weeks of speculation over whether the bank will move its headquarters from the UK.

Shares in Europe's largest bank erased earlier losses and moved higher on the news. They were last up 0.2% at 647.90p.

The lender reported pretax profit of $7.06 billion in the three months to the end of March, up 4% on the $6.76 million it made in the same period last year.

Adjusted pretax profit - taking into account higher costs of $483 million - was 5% higher at $6.89 million.

The jump in costs came as the bank hired more compliance staff to help navigate sweeping changes to banking regulation.

The new, tougher rules are part of the reason the bank is considering leaving Britain, along with the UK bank levy.

Last year HSBC paid £750 million in bank levy, more than any other bank and just over a third of the total £2.2 billion demanded by the Treasury. That figure will rise sharply over the next two years.

Revenue at its global markets and banking - home to its investment banking operations - rose 8%.

Additional reporting by Reuters