HSBC profits up 5% in first half of 2017

HONG KONG (AFP) – HSBC said profits were up Monday in the first half of the year in what it called an “excellent’’ result after a turbulent 2016.

The Asia-focused giant has been on a recovery drive over the past two years to streamline the business and slash costs, and has laid off tens of thousands of staff.

Reported pre-tax profit for the six months to June rose five percent to $10.2 billion compared with $9.7 billion for the same period last year.

The results came after operating expenses dropped 12 percent to $16.4 billion, partly stemming from a sell-off of its Brazil operations.

HSBC also announced a share buyback of up to $2 billion, expected to be completed in the second half of the year.

Chairman Douglas Flint described the results as “extremely pleasing.’’

Flint said that there were still uncertainties due to increasing geopolitical tensions and “ambiguous predictions’’ around Britain’s future relationship with the European Union post-Brexit, but described HSBC’s performance as resilient.

Analysts said the results had outstripped predictions.

“HSBC’s earnings are definitely better than market expectations, said Dickie Wong of Hong Kong-based Kingston Securities.

He described the firm as in “very good shape’’ after wideranging restructuring programs following the global financial crisis in 2008.

Net profit for the first half of the year rose 10 percent to $6.99 billion from $6.36 billion for the same period in 2016.

Pre-tax profits for the second quarter rose $1.7 billion to $5.3 billion year on year, beating Bloomberg analysts’ estimates, which had averaged out at a $4.6 billion forecast.