Europe’s largest bank, HSBC Bank Plc. has made a comeback by reporting a profit of 4.58 percent with revenue of $10.71 billion in the first half of 2018 which was a way ahead of analyst estimates of $10.38 billion.
On the other hand, operating expenses were up to $17.5 billion in the first half of the year as compared to $16.4 billion in the same vicinity last year.
“This is creating room to invest while maintaining our commitment to full-year positive adjusted jaws,” John Flint, Chief Executive of HSBC said in a statement, accompanying the results announcement.
In his previous announcement of June, Flint stated that the bank plans to spend an additional $15 billion to $17 billion in areas, including ‘growth and technology’ between 2018 and 2020. Doing so would grow the bank’s cost base by low-to-mid-single digit percentages each year until the end of 2020.
Speaking about its $2 billion share buyback program announced in May, HSBC stated that, as of June 30, $1 billion of shares had been bought back and cancelled.
HSBC shares rose in the Hong Kong share market
HSBC shares rose 0.83 percent in the Heng Seng Index of Hong Kong stock market.
Dickie Wong, executive director of Kingston Securities, said recently that he expects HSBC to report a 5 percent gain in pre-tax profit for the six months ending June.
Wong said, “First of all, we see a clear tendency everywhere, not just in Hong Kong, for interest margin to be improving. And also, HIBOR is on a good track, so I think HSBC can make a comeback after the slight drop in the first quarter.”
The Hong Kong Interbank Offered Rate, known by its abbreviation HIBOR, is a reference rate for lenders and borrowers that participate directly or indirectly in the Asian economy.
With several restructuring changes in the past year, HSBC has been working to grow its business again. The new structure, HSBC Global Private Banking, EMEA, has been led by recently appointed Chris Allen, Regional Head of Global Private Banking.
