HSBC profits jump as bank set for major shakeup
HSBC reported a 10% increase in quarterly profits, reaching $8.5 billion in pre-tax earnings for the three months ending September, surpassing analysts’ expectations. This gain aligns with the UK-based bank’s significant restructuring initiative, one of the most extensive in its 159-year history. The bank will reorganize operations geographically, dividing its business into eastern and western markets as it navigates rising geopolitical challenges and seeks to reduce expenses.
Newly appointed CEO Georges Elhedery stated that the restructuring will begin immediately, with additional details to be provided in the bank’s full-year results in February.
HSBC also announced a $3 billion share buyback program, which helped drive its shares up by over 2% in Hong Kong trading.
According to Michael Makdad, a senior equity analyst at Morningstar, the focus will likely be on HSBC’s strategic overhaul rather than the generally strong quarterly performance.
Additionally, HSBC aims to complete the sale of its Argentinian operations by year-end, continuing its recent pivot toward Asia, where it generates most of its revenue.
The bank also appointed Pam Kaur as its first female finance chief; Kaur, currently chief risk and compliance officer, will also join HSBC’s board as an executive director, subject to election at the next annual general meeting. Elhedery’s appointment as CEO in early September came at a pivotal time, as HSBC works to balance its presence in both Asian and Western markets amidst escalating geopolitical tensions.
