HSBC bank says profits 'well ahead' on year earlier

5th November 2010, Comments 0 comments

Asia-focused banking giant HSBC, in the midst of a management shake-up, said on Friday that current pre-tax profits were "well ahead" compared with 12 months earlier, without giving precise figures.

"At the end of the third quarter (Q3), HSBC's pre-tax profits for the year to date remained well ahead of 2009," Europe's biggest bank said in a trading update.

"Pre-tax profits for Q3 2010 were also well ahead of Q3 2009," it added.

However London-based HSBC added that pre-tax profit in the third quarter grew more slowly than in the first half of the year and that revenue was down in the first nine months compared with the equivalent period in 2009.

On a brighter note, it revealed that bad loans fell across its regions of operation, including in the United States.

"The global economy is in better shape than many expected a year ago, and I am pleased to report that HSBC's performance in October was in line with third quarter trends," HSBC's outgoing chief executive Michael Geoghegan said in the statement.

"But, while fears of a double-dip in the West may be overplayed, the passage from downturn to upturn is clearly taking longer than previous cycles.

"Our latest data from emerging markets points to a slowdown in the rate of recovery and the likelihood of some bumps in the road ahead. However, we believe the long-term fundamentals for emerging economies are as compelling as ever.

"It remains our conviction that growth there will outpace the developed world for the foreseeable future," added Geoghegan, who plans to step down early next year.

HSBC had unveiled a huge boardroom shake-up in late September as it looks to build on its recovery after the financial crisis as well as profiting from strong growth in Asia.

HSBC said Stuart Gulliver, head of its investment arm, is to replace Geoghegan as chief executive, while finance director Douglas Flint will be the bank's new chairman following the resignation of Stephen Green.

The overhaul at the top of HSBC follows a tumultuous period for the bank, with Geoghegan reportedly failing to win enough support to become chairman after 37 years with the lender.

© 2010 AFP

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