Banking behemoth HSBC appears to have recovered from the ravages of Covid-19, with first-half profits more than doubling on last year.
The Asia-focussed bank recorded pre-tax profits of $10.8bn for the first six months of the year, some $6.5bn ahead of last year’s equivalent.
The bank said all of its regions were profitable, with HSBC’s UK division reporting pre-tax profits of some $2.1bn alone.
Profits were boosted by the release of credit loss provisions, after the bank put aside some $6.9bn last year to cover Covid-19 uncertainty.
Boss Noel Quinn, who has done away with his office and replaced the executive floor in HSBC’s Canary Wharf office with a series of hotdesks, hailed “good” results that reflected “the return of growth in our main markets.”
Though profits swelled, revenues were down 4 per cent due to low global interest rates.
The Bank’s net interest margin fell again to 1.21 per cent, down .22 on last year.
The Board also announced an interim dividend of 7 cents per share after the Bank of England lifted caps on bank dividends last month.
Hargreaves Lansdown’s Susannah Streeter suggested that the firm needed to keep an eye on its profitable Asian markets.
“As well as expanding its overall wealth business, the bank has been shifting to Asia to try and sniff out higher returns, moving capital investment and staff from Europe and the US,” she said this morning.
“Although recovery in the region has so far been good news for HSBC’s profits, it has faced reputational headwinds over accusations it was too close to Chinese authorities which have cracked down on pro-democracy protestors in Hong Kong.
“Worries are now rife that there could be a downturn in investment due to Beijing’s crackdown on tech and online educational firms in particular. So far the bank says it isn’t changing its forecasts of investment pouring in to seek out opportunities, but the days are still early, and there are some concerns it could upset its resilient recovery.,” she continued.