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HSBC profits plunge after China write-downs

Published 21/02/2024, 07:46
Updated 21/02/2024, 07:46
© Reuters.  HSBC profits plunge after China write-downs

Proactive Investors - Shares in HSBC Holdings PLC (LON:HSBA) fell over 3% in Hong Kong and are likely to do the same in London after posting full-year results that showed fourth-quarter profits plummeted 80% to $1 billion.

This largely reflected a $3 billion impairment charge relating to an investment in associate Chinese bank BoCom, the sale of retail banking operations in France and a further writedown on commercial real estate.

On the plus side for investors, the board approved a fourth interim dividend of $0.31 per share, resulting in a total for 2023 of $0.61 per share, and promised a share buyback of up to $2 billion.

For the full year, revenue rose 30% to $66.1 billion and pre-tax profits almost 80% to $30.3 billion.

Chief executive Noel Quinn said this was a record performance, which "enabled us to reward our shareholders with our highest full-year dividend since 2008, three share buy-backs last year totalling $7bn, and a further share buy-back of up to $2bn. This reflected four years of hard work and the strength of our balance sheet in a higher interest rate environment."

Profit was boosted by $2.5 billion relating to French sale, which was completed on 1 January 2024, and a $1.6 billion provisional gain recognised on the acquisition of Silicon Valley Bank UK Limited in 2023, partly offset by Chinese impairment charges.

Net interest margin increased by 24 basis points to 1.66%, reflecting higher interest rates.

Read more on Proactive Investors UK

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