HSBC's Profit Jumps as Global Economy Recovers
April 27 2021 - 12:30AM
Dow Jones News
By Simon Clark and Quentin Webb
Global banking giant HSBC Holdings PLC said net profit more than
doubled in the first quarter, as the world economy began to recover
from the coronavirus pandemic.
The London-based lender, which makes most of its profit in Hong
Kong and mainland China, earned $3.88 billion in the first three
months of the year, up from $1.79 billion in the same period last
year.
HSBC reduced provisions for bad loans by $435 million in the
quarter, which it said was mostly due to an improved economic
outlook. It had taken more than $3 billion of new provisions in the
same period last year.
HSBC Chief Executive Noel Quinn is one year into overhauling the
bank to refocus its operations on Asia. In February, he said he was
considering selling the unprofitable U.S. retail operations and
pouring about $6 billion of investment into Asia in the next five
years. HSBC is also in talks to sell its unprofitable French retail
bank.
Geopolitical tensions between China and the West have strained
Mr. Quinn's ambitions. Last year, HSBC supported China's imposition
of a national-security law in Hong Kong, which the U.S. and British
governments opposed.
Pretax profit from HSBC's Hong Kong and mainland China
operations fell 18% to $2.86 billion in the first quarter. The bank
reported a $484 million pretax profit in North America.
Mr. Quinn has ruled out moving HSBC's headquarters back to Hong
Kong, where the bank was founded in 1865. But he told staff this
month that executives in charge of commercial lending, banking and
markets, wealth and personal banking, and asset management would
relocate to Hong Kong from London this year.
Write to Simon Clark at simon.clark@wsj.com and Quentin Webb at
quentin.webb@wsj.com
(END) Dow Jones Newswires
April 27, 2021 01:15 ET (05:15 GMT)
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