HSBC yesterday said that pre-tax profit fell 19 percent in the first three months of the year, but the bank’s boss described them as “a good set of results” after last year’s turbulence.
The London-based giant has been on a recovery drive over the past two years, aiming to slash costs with measures including laying off tens of thousands of staff and slimming down its business.
It blamed the drop in reported profit to US$4.96 billion on a change in accounting the fair value of its debt, while the results from a year ago included proceeds from its Brazil business, which was sold in July last year.
Photo: Bloomberg
It also posted a 19.5 percent fall in year-on-year net profit to US$3.13 billion from US$3.89 billion.
However, adjusted pre-tax profit, which excludes one-time items, rose to US$5.94 billion from US$5.3 billion a year earlier. Analysts had forecast US$5.3 billion in a survey by Bloomberg News.
“This is a good set of results,” group chief executive Stuart Gulliver said in a statement to the Hong Kong stock exchange.
He added that the adjusted pre-tax figure was boosted by a US$1 billion share buy-back as well as progress on the cost-saving program.
Huarong International Securities (華融國際金融) analyst Jackson Wong (黃志陽) said he thought the results were positive overall.
“They cleaned up a lot of bad things in the last quarter of last year so this quarter, everything looks pretty decent, even the cost-cutting is on track,” Wong said.
The bank in 2015 announced a radical overhaul to cut 50,000 jobs and exit non-core and unprofitable businesses and focus more on Asia.
However, the firm’s profits were dealt a hammer blow last year, with executives attributing the decline to protectionist fears Donald Trump and uncertainties caused by Britain’s decision to leave the EU.
Gulliver yesterday said that this year would see the completion of strategic measures announced in 2015, including the removal of low-return risky assets.
“Our cost-saving program remains on track to hit the higher cost-saving target we announced at our annual results,” he added.
The first-quarter results were the first since the banking giant announced the appointment of a new chairman in March as part of a management overhaul that will also see it choose a new chief executive, following the massive drop in profits last year.
British businessman Mark Tucker, currently group chief executive and president of insurance group AIA, will take over from Douglas Flint in October and lead the hunt for a new chief executive to replace Gulliver, who is set to retire next year.
PROTECTIONISM: China hopes to help domestic chipmakers gain more market share while preparing local tech companies for the possibility of more US sanctions Beijing is stepping up pressure on Chinese companies to buy locally produced artificial intelligence (AI) chips instead of Nvidia Corp products, part of the nation’s effort to expand its semiconductor industry and counter US sanctions. Chinese regulators have been discouraging companies from purchasing Nvidia’s H20 chips, which are used to develop and run AI models, sources familiar with the matter said. The policy has taken the form of guidance rather than an outright ban, as Beijing wants to avoid handicapping its own AI start-ups and escalating tensions with the US, said the sources, who asked not to be identified because the
FALLING BEHIND: Samsung shares have declined more than 20 percent this year, as the world’s largest chipmaker struggles in key markets and plays catch-up to rival SK Hynix Samsung Electronics Co is laying off workers in Southeast Asia, Australia and New Zealand as part of a plan to reduce its global headcount by thousands of jobs, sources familiar with the situation said. The layoffs could affect about 10 percent of its workforces in those markets, although the numbers for each subsidiary might vary, said one of the sources, who asked not to be named because the matter is private. Job cuts are planned for other overseas subsidiaries and could reach 10 percent in certain markets, the source said. The South Korean company has about 147,000 in staff overseas, more than half
Taipei is today suspending its US$2.5 trillion stock market as Super Typhoon Krathon approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed-income trading, statements from its stock and currency exchanges said. Yesterday, schools and offices were closed in several cities and counties in southern and eastern Taiwan, including in the key industrial port city of Kaohsiung. Taiwan, which started canceling flights, ship sailings and some train services earlier this week, has wind and rain advisories in place for much of the island. It regularly experiences typhoons, and in July shut offices and schools as
CHEMICAL FIRE: 10 Indian employees were injured by smoke inhalation at a Tata Electronics plant in Tamil Nadu state that produces components for Apple Inc At least 10 people received medical treatment, with two hospitalized after a major fire on Saturday disrupted production at a key Tata Electronics Pvt Ltd plant in southern India that makes Apple Inc’s iPhone components. The fire occurred at the plant in the city of Hosur in Tamil Nadu state that makes some iPhone components. It broke out near another building inside the Tata complex, which was to begin producing complete iPhones in the coming months. The fire was contained to one building and has been extinguished fully, top district administrative official K.M. Sarayu said. No decision has been made on when
RSS