BREAKING NEWS

BREAKING NEWS

HSBC beats estimates with 31 percent first-quarter profit rise as expenses fall

HSBC beats estimates with 31 percent first-quarter profit rise as expenses fall
FILE PHOTO: The HSBC bank logo is seen at their offices in the Canary Wharf financial district in London, Britain, March 3, 2016. REUTERS/Reinhard Krause -
Copyright
Reinhard Krause(Reuters)
Text size Aa Aa

HONG KONG/LONDON (Reuters) - HSBC Holdings PLC posted a 31 percent rise in first-quarter profit, beating estimates, bolstered by a surge in income in its core Asian business and as the London-headquartered bank managed to rein in costs.

Profit before tax at Europe's biggest lender by assets rose to $6.21 billion (£4.8 billion) in the January-March quarter from $4.76 billion in the same quarter last year, it said in a stock exchange filing on Friday.

The latest quarter's profit was above the $5.58 billion average of analysts' estimates compiled by the bank.

HSBC warned in February that it may have to delay some investments this year as it missed 2018 profit forecasts due to slowing growth in its two home markets of China and Britain.

Chief Executive John Flint said in June HSBC would invest $15 billion-$17 billion over three years in areas including technology and China, while keeping profitability and dividend targets unchanged.

The bank said reported operating expenses dropped 12 percent in the March quarter.

Reining in costs has been one of the biggest challenges for Flint, who completed his first year at the helm in February, with the bank last year missing its target of 'positive jaws' - which tracks whether the bank is growing revenues faster than costs.

While HSBC has been boosting investments to raise its market share in businesses such as retail banking and wealth management, some of its other units, mainly investment banking, struggled with staff exits and slower revenue growth.

The lender reshuffled its global banking division on Tuesday as former JPMorgan banker Greg Guyett put his stamp on the business, which has been under pressure in recent years.

The bank's core capital ratio, a key measure of financial strength, rose to 14.3 percent at the end of March from 14 percent at the end of 2018, it said. Analysts expected the latest end-quarter ratio to be at 14.0 percent.

(Reporting by Sumeet Chatterjee and Lawrence White; Editing by Muralikumar Anantharaman)

euronews provides breaking news articles from reuters as a service to its readers, but does not edit the articles it publishes. Articles appear on euronews.com for a limited time.