HSBC prof its rocket thanks to Asia loans
HSBC’S quarterly profi ts soared to $ 4.62billion (£ 3.5billion) as it pushed ahead with cost- cutting and reaped the rewards of growth in Asian markets.
Pre- tax profi t at Europe’s biggest bank for the three months to September 30 jumped from $ 843million last year, when it booked a $ 1.7billion loss following the sale of its Brazil operations.
Quarterly revenue jumped by 36 per cent from the same period last year, although it was slightly down on the previous three months.
Lending growth in Asia, which now generates over 70 per cent of group profits was up 17 per cent, with $ 1.1billion of lending added in China’s Guangdong province alone.
Its Asian insurance and assets management businesses have grown new business premiums and assets under management by 13 per cent and 17 per cent respectively in the fi rst nine months of the year.
HSBC has made expansion in China’s Pearl River Delta a key strategy, previously fl agging the recruitment of 4,000 staff to help with the push.
Meanwhile, a further $ 600million of costs were stripped out of the business in the third quarter to keep HSBC on track to achieve $ 6billion of annual savings by the end of the year.
Chief executive Stuart Gulliver said: “Our international network continued to deliver strong growth in the third quarter, and our pivot to Asia is driving higher returns and lending growth, particularly in Hong Kong.”
Gulliver, who retires next year after seven years in charge, said “good progress” was being made with a strategic overhaul of the business set out in 2015, including shedding thousands of jobs and shrinking its global presence. Laith Khalaf at investment fi rm Hargreaves Lansdown, said: “Regionally it’s Asia which is doing the heavy lifting for HSBC, and while the bank is headquartered in the UK, its business primarily resides in the far east.
“The fortunes of HSBC are largely tied up in the Asian growth story. As the CEO baton is about to be passed from Stuart Gulliver to John Flint, HSBC will hope to make good on its eastern promise.”