HSBC 1st Half Profit Rises on Growth in Retail Banking, Wealth Management

   By Kenan Machado 
 

HONG KONG--HSBC Holdings PLC (0005.HK) said first-half net profit rose 2.4% from a year earlier thanks to fees from money-management services, particularly in Hong Kong.

The U.K. lender said Monday net profit for the six months ended in June increased to $7.17 billion from $7.00 billion.

Profit before tax rose 4.6% to $10.71 billion.

Revenue rose 4.3% to $27.29 billion from $26.2 billion on higher margins on deposits and balance growth as well as favorable currency effects, the bank said.

However, taking into account currency moves and one-time charges, adjusted profit before tax fell 1.8%.

Higher deposits by retail customers and "strong" sales of wealth management products in Hong Kong helped revenue grow in the lender's retail banking and wealth management segments, HSBC said. The segments' collective contribution to first-half profit rose to nearly 30% from 27.5%.

"We also grew our share of the U.K. mortgage market," said Group Chief Executive John Flint.

Banks, particularly in Hong Kong and elsewhere in Asia, earn lucrative fees for managing the money of wealthy clients who seek to beat low returns on deposits. Having significant operations in Hong Kong has helped HSBC as rich Chinese opt to keep money in the city, outside the mainland.

For the second quarter, net profit rose 5.7% from a year earlier, to $4.09 billion from $3.87 billion. Profit before tax rose to $5.96 billion from $5.3 billion.

HSBC announced a dividend of $0.31 per ordinary share.

Hong Kong-listed shares of HSBC rose nearly 1% to 73 Hong Kong dollars after the lunch break.

Write to Kenan Machado at [e-mail]

(END) Dow Jones Newswires

August 06, 2018 02:18 ET (06:18 GMT)

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