HSBC reported pre-tax profit of $9.6bn for the third quarter on Tuesday, up 32 per cent from $7.3bn a year earlier and broadly in line with analysts' average forecast of $9.7bn. Higher interest rates and lower credit losses lifted the result, and the bank booked no legal provisions in the quarter, unlike a year earlier.
Expected credit losses fell 17 per cent to $800m, helped by lower charges linked to Hong Kong commercial property and to its UK and Mexican businesses. HSBC announced a further share buyback of up to $1bn, the same as last quarter, and an unchanged interim dividend of $0.10 a share.
Wealth growth stalls
Revenue from the wealth business, a priority for the bank's management, was flat at $2.7bn, after growth of 15 per cent and 23 per cent in the first two quarters. The shares fell about 5 per cent in Hong Kong after the results, though they remain up about 11 per cent this year.
HSBC said it remained on track to meet its profitability targets through 2028. It also said the Basel 3.1 capital reforms could add up to half a percentage point to its core capital ratio, having previously described the effect as a modest benefit.
The results came a day before a UK budget in which the chancellor is reported to be considering a higher surcharge on bank profits.
