HSBC says Q1 net profit more than doubles to $7.86 bn

PHOTO: HSBC says Q1 net profit more than doubles to $7.86 bn

LONDON - Asia-focused bank HSBC announced on Tuesday that net profits more than doubled to US$6.35 billion (S$7.86 billion) in the first quarter, aided by tumbling bad debts and cost cutting.

Earnings after taxation surged 146 per cent in the three months to the end of March, from US$2.58 billion in the same part of 2012, the lender said in a results statement.

Underlying pre-tax profits, stripping out exceptional items, soared 34 per cent to US$7.6 billion. Revenues rose five per cent to US$17.6 billion.

"We have had a good start to the year, with growth in reported and underlying profit before tax," said chief executive Stuart Gulliver in the earnings release.

He added: "While continuing uncertainty in the global economy has created a relatively muted environment for revenue growth, we have increased revenue in key areas including residential mortgages and commercial banking in both our home markets of Hong Kong and the UK, and in our financing and equity capital markets business.

"Loan impairment charges were lower in every region, notably in North America," he said, adding that the group was also lifted by its "continued focus on cost management".

Bad debts - consumer loans that have turned sour - sank 44 per cent to US$1.17 billion in the reporting period. That compared with $2.09 billion last time around.

The lender, which is Europe's biggest bank by market value, has axed more than 37,000 jobs since the end of 2010 in a huge restructuring.

Last year, meanwhile, the bank had posted a 16.5-per cent slump in annual net profits as it was hit by US money-laundering fines, mis-selling scandals, rising taxation and a vast accounting charge.