Favourable interest rates and lower charges helped quarterly earnings, while wealth revenue stopped growing after two quarters of gains. HSBC launched another buyback of up to $1 billion to return capital to shareholders.
HSBC said on 27 October that July–September pretax profit rose 32% to $9.6 billion, while revenue from its wealth division stayed flat at $2.7 billion. The bank also announced an interim dividend of $0.10 a share, which it said would distribute $1.71 billion to investors.
Profit matched estimates compiled by HSBC. Favourable interest rates helped earnings, Reuters said in a report published by CNA.
The Guardian said net interest income—the difference between interest earned on loans and interest paid on savers’ deposits—rose to $9.3 billion from $8.8 billion a year earlier. That was an increase of 6%, or $500 million.
HSBC attributed the increase to deposit growth and higher returns from reinvestment under its hedging strategy, which manages interest-rate risk. Deposits grew in Hong Kong but stayed flat in the UK.
Operating expenses fell 12%, or $1.3 billion, to $8.8 billion. Earnings also benefited from a $1.4 billion decline in legal provisions—money set aside for legal claims—as provisions booked in the same quarter a year earlier did not recur.
HSBC said expected credit losses, its estimate of losses on lending, fell 17% to $800 million. It attributed the decline to lower charges linked to Hong Kong’s real estate sector and its UK and Mexican wealth businesses. Those lower charges also supported profit.
The flat wealth revenue followed double-digit growth in each of the first two quarters.
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| Quarter | Revenue growth |
|---|---|
| First quarter | 15% |
| Second quarter | 23% |
| Third quarter | 0% |
Alongside the dividend, HSBC launched a programme to buy back up to $1 billion of its own shares, matching the previous quarter’s amount.
The bank kept its core profitability targets unchanged and said it remained on track to meet them through 2028.
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