HSBC’s profits after tax dip 2% to $17.7b in H1

The bank recognized a $1.2b impairment for the sale of its Argentina business.

HSBC saw its profit after tax fall by 2% to $17.7b in H1, as it recognized a billion-dollar impairments for the sale of its assets. 

HSBC recognized an impairment of $1.2b for the sale of its Argentina business. It also included a $2.1b reversal of an impairment related to the sale of its retail banking operations in France, according to its 2024 interim financial results.

The bank also recognized a $4.8b gain from the disposal of its banking business in Canada; and a $1.5b gain for the acquisition of Silicon Valley Bank UK.

Revenue inched up 1% to $37.3b in H1, compared to the same period in 2023.

Distribution for the first half is $13.7b. 

HSBC group CEO Noel Quinn shared that the bank’s investment in wealth is delivering “higher, more diversified revenue.” 

“We are confident that we have the right strategy and model to grow revenue, even in a lower interest rate environment, and are therefore providing new guidance of a mid-teens return on average tangible equity in 2025,” Quinn said. 

Net interest income fell by $1.4b, which HSBC blamed on reductions due to business disposals, deposit migration, and redeployment in the trading book in HSBC and in Hong Kong.

Net interest margin is 1.62%, 8 basis points (bp) lower compared to H1, due to higher funding costs.

Operating expenses rose 5% to $16.3b, which HSBC said was due to “higher technology spend and investment, inflationary pressures, and an increase in performance-related pay accrual.”

Customer lending balance is $938b, a $12b increase on constant currency basis compared to December 2023.