HSBC Q3 Pre-tax Profit More-than Doubles; To Repurchase $3 Bln Of Shares

HSBC Holdings Plc (HSBA.L,HSBC), a British lending major, on Monday reported a surge in pre-tax earnings for the third-quarter of 2023, reflecting a positive impact of a higher interest rate environment and a rise in revenue.

In addition, HSBC said: “We also intend to initiate a further share buy-back of up to $3bn, which we expect to commence shortly and complete by our 2023 full-year results announcement on 21 February 2024.”

For the three-month period to September 30, the company posted a pre-tax income of $7.714 billion, sharply higher than $3.229 billion, recorded for the third-quarter of previous year.

The earnings were supported by $2.3 billion impairment in third-quarter of 2022 related to the planned sale of retail banking operations in France, of which $2.1 billion was reversed in the first-quarter of 2023 as the completion of the transaction became less certain. The bank now expects to reclassify these operations held for sale in the fourth-quarter of 2023, at which point the impairment would be reinstated.

After tax, profit stood at $6.266 billion or $0.29 per share as against last year’s $2.657 billion or $0.10 per share.

Operating income was at $7.122 billion, compared with $2.647 billion a year ago.

Net operating profit stood at $15.090 billion, versus $10.440 billion in 2022.

Net interest income improved to $9.248 billion from previous year’s $8.006 billion.

Net fee income was $3.003 billion, up from previous year’s $2.852 billion.

Non-interest income increased by $3.4 billion or 97 percent to $6.9 billion, mainly due to the non-recurrence of the impairment related to the sale of the retail banking operations in France.

Revenue increased by $4.7 billion or 40 percent to $16.2 billion, as the higher interest rate environment supported growth in net interest income in all of the company’s global businesses, and increased non-interest income.

The company will pay a third interim dividend of $0.10 per share on December 21, to shareholders of record as of November 10.

Looking ahead, for full year 2023, the lender continues to expect net interest income of over $35 billion.

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