Banking giant HSBC has reported a five-fold increase in third quarter profit as a sweeping overhaul aimed at shifting focus towards Asia pays off.
Pre-tax profit climbed to $4.62bn, up from $843m in the same period last year as revenue rose 13% to $13bn, the UK-based group said.
The large increase was partly due to a one-off $1.7bn hit from the sale of its Brazilian unit, and currency movements, that weighed on third quarter results in 2016.
Stripping these out, adjusted profits actually fell 1% to $5.44bn as costs grew, reflecting investments in business growth programmes as well as higher banker bonuses.
Shares were nearly 1% lower in early trading in London.
HSBC is nearing the end of a major restructuring, launched in 2015, that includes shedding thousands of workers and shrinking its global size so it can focus more on Asia’s emerging markets.
It is also bringing in new leadership, with new chief executive John Flint set to replace current boss Stuart Gulliver in February.
HSBC is Europe’s biggest bank, but it makes more than half of its profits in Asia.
It said its customer base for retail banking and wealth management in mainland China had expanded by more than 70% so far this year.
Mr Gulliver said the bank “maintained good momentum”.
He added: “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.”
HSBC, like other UK banks, is still counting the cost of paying back customers for past mistakes, adding another $84m to its redress bill in the latest quarter – though this was sharply down on the $456m seen in 2016.
The results come after rivals Lloyds and Royal Bank of Scotland and Barclays last week also each reported an improved bottom line.
However, Barclays received the thumbs down from investors after a tough period for its investment banking arm.
Source: Sky News