HSBC profits sink as it fights 37 legal battles

And from FIFA fraud probe to Bernie Madoff scandal, here’s the list in full . . .

THE boss of HSBC has been forced to take a bonus cut over money laundering failings at the bank.

Stuart Gulliver took home £ 5.7m last year, down from £7.4m in 2015.

And shares fell heavily after the lender revealed annual profits had plunged 62pc to £5.7bn.

The 57-year-old’s pay cut was partly down to concerns raised by an independent monitor, which was installed after a 2012 probe revealed links with Mexican drug cartels.

The monitor said that although progress was being made to make the bank safer, it was not happening fast enough.

And in the UK, the Financial Conduct Authority has launched a fresh investigation into HSBC’s money laundering controls.

Bosses could not say how much this might cost the bank.

HSBC is facing around 37 separate probes and lawsuits over a litany of bad behaviour ranging from unfair hiring practices and tax fraud to price-fixing and involvement in a giant Ponzi scheme.

But yesterday, senior managers sought to defend the progress they had made.

‘The FCA investigation is a followup on work that’s already been done,’ Gulliver said.

‘It’s quite normal for a bank of our size, with 36m customers, to find incidents of money laundering amongst that business.

‘The FCA is looking to verify that the checks and controls we have in the UK are sufficient.’

Gulliver’s pay was made up of a base salary of £1.3m and a £1.7m fixed pay allowance designed to get around a European Union bonus cap. He had £375,000 paid into his pension and a £1.7m annual bonus.

Another £628,000 came in the form of benefits such as life insurance, a car allowance and HSBC- owned accommodation in Hong Kong.

Part of his bonus was linked to compliance with the law – and this element was cut back after ‘unsatisfactory audits’ relating to anti-money laundering procedures.

Chairman Douglas Flint said the criticisms were ‘not in terms of direction of travel or commitment to the destination’.

But he said: ‘ We weren’t doing as well as we thought we were.’

HSBC shares fell 6.5pc or 46.6p in London yesterday to 665.7p as the scale of the bank’s profit drop took analysts by surprise.

It was largely down to one-off costs including the sale of operations in Brazil, £ 2.5bn of restructuring expenses and a £2.6bn write-down of the private banking division.

HSBC, nonetheless, maintained its annual dividend at $0.51 per share, handing investors a total of £8.1bn. And the bank announced it would buy back £800m of shares from the market in another sweetener. However, this was smaller than the £2.4bn experts had hoped for. City commentators said it showed HSBC still had some way to go before it was once again firing on all cylinders.

‘It’s a bank that is still in transition after the crisis,’ said Chris Wheeler of Atlantic Equities.

In the UK, HSBC is shutting 62 branches this year after closing 223 in 2016 against a backdrop of ever- tighter margins due to record-low interest rates.

Gulliver is targeting £4.8bn of annual savings through restructuring, although he said this was unlikely to lead to large- scale job losses. But he warned that technological change could put many professionals out of work in coming years.

And as Britain leaves the EU, he said HSBC’s presence in 71 countries meant it could help the country forge fresh global trading links. He again said the bank would have to move 1,000 jobs to Paris if Brexit disrupted finance firms’ access to the single market, but argued London would remain Europe’s dominant banking hub and any lost revenue would be replaced within two or three years.