HSBC, one of the largest banking institutions in the United Kingdom, has reported strong profit growth and raised its outlook for 2023. The company’s shares have seen a positive response in both the London Stock Exchange and pre-market activity in the NYSE.
In its second quarter, HSBC witnessed a significant increase in profit and revenues. Profit before tax rose by 89% to $8.77 billion compared to the previous year. Profit after tax also saw a notable increase of 28% to $7.05 billion. The growth in revenue was equally impressive, reaching $16.71 billion—a 36% growth compared to the same period last year. These figures were primarily driven by increases in global interest rates, resulting in growth across all of HSBC’s global business units.
HSBC has also decided to initiate a share buy-back of up to $2 billion, which is expected to commence shortly and be completed within three months. This move aims to further enhance shareholder value.
Looking ahead, HSBC has raised its fiscal 2023 profit guidance. The company now expects net interest income to exceed $35 billion, reflecting the current consensus for global central bank rates. HSBC had previously projected net interest income to be at least $34 billion in 2023. The revised outlook demonstrates the company’s confidence in its ability to deliver strong financial performance over the coming years.
Noel Quinn, Group Chief Executive at HSBC, acknowledges that external uncertainty remains a challenge. High inflation continues to be a concern for many of the bank’s customers. However, despite these challenges, Quinn expressed confidence in HSBC’s ability to achieve its revised return on tangible equity (RoTE) target for 2023 and 2024.
The positive results have prompted HSBC’s board to approve a second interim dividend of $0.10 per share, payable on September 21. This reflects the bank’s commitment to returning value to shareholders.
In the London Stock Exchange, HSBC shares were trading at 661.87 pence—an increase of 2.41%. Pre-market activity on the NYSE also saw the stock rise by around 1.9% to $42.58.
HSBC’s strong second-quarter performance and positive outlook for 2023 indicate that the bank is well-positioned to navigate the challenges of the current economic landscape. As it continues to deliver value to shareholders, HSBC remains a key player in the global banking industry.
