HONG KONG/LONDON - HSBC Holdings PLC beat forecasts with a 31 percent rise in first quarter profit, bolstered by a surge in income from its core Asian business and lower costs that outweighed a poor performance from investment banking.
Europe’s biggest bank by assets said operating expenses dropped 12 percent in the January-March quarter, helped by one-off sales in its retail and commercial businesses and the non-recurrence of U.S. regulatory fines for past misdeeds. While HSBC’s U.S. business continued to drag down the group and its investment bank fared poorly compared with peers, the bank grew revenues 7 percent in Asia and saw income in its retail and commercial banking divisions rise around 10 percent.
HSBC’s stock traders did particularly badly, with revenues tumbling 34 percent excluding a favorable one-off provision, the worst performance of an equities business in the quarter among major U.S. and European banks. The lender reshuffled the unit on Tuesday as former JPMorgan banker Greg Guyett put his stamp on the business.
The bank said the turnaround strategy for its U.S. business, which has for years underperformed, was progressing, but the task remained its “most challenging strategic priority”.