A view of the brand of HSBC financial institution on a wall outdoors a department in Mexico City, Mexico, on June 14, 2024.
Henry Romero | Reuters
Europe’s largest lender HSBC on Wednesday reported annual pre-tax revenue of $29.91 billion, beating analysts’ estimates on the again of a powerful efficiency in its wealth division and Hong Kong companies.
While annual revenue declined 7.4%, HSBC’s income gained 4%, year on year, and each exceeded estimates.
Here are HSBC’s full-year results in contrast with the consensus estimates compiled by the financial institution.
- Pre-tax revenue: $29.91 billion vs. $28.86 billion
- Revenue: $68.27 billion vs. $67.36 billion
The lender’s fourth-quarter revenue earlier than tax rose to $6.8 billion, up $4.5 billion from a year earlier, largely because of favorable one-off objects linked to enterprise disposals. Operating bills rose 8% to $9.3 billion, reflecting restructuring prices, know-how funding and better performance-related pay.
Its income for the ultimate quarter jumped 42% year on year to $16.4 billion.
HSBC Group CEO Georges Elhedery mentioned in an announcement that 2025 marked a year of “decisive action and swift execution,” with all 4 of the financial institution’s companies performing effectively and constructing sturdy momentum.
The lender now goals to ship a return on common tangible fairness — a measure of profitability — of 17% or extra, excluding notable objects, in between 2026 and 2028. RoTE was 13.3% in 2025.
The results come shut on the heels of HSBC finishing the privatization of Hang Seng Bank on Jan. 26, with the latter’s shares subsequently delisted from the Hong Kong Stock Exchange.
HSBC mentioned final year that the deal could be add to its earnings and was a greater use of capital than buybacks.
“We do anticipate revenue and cost synergies between the two brands, but we expect that to come through gradually in the medium term,” Morningstar’s fairness analyst Kathy Chan mentioned.
The take personal supply was “an exciting opportunity to grow both Hang Seng and HSBC,” Elhedery said last October, including that the financial institution would protect Hang Seng’s model whereas investing to strengthen its capabilities.
Addressing questions on potential job cuts, Elhedery informed CNBC’s Emily Tan that HSBC was focusing on about 8% discount in payroll prices, however burdened the financial institution had not not set particular headcount discount targets.
He mentioned the main target was on simplifying the group at scale and eradicating duplicate roles, pointing to a web 15% discount in managing director positions by means of de-duplication.
At the beginning of the month, Bloomberg reported that HSBC was set to award minimal or no bonuses to some bankers because it strikes towards a harder, extra performance-driven compensation mannequin much like that of its Wall Street friends.
The financial institution intends to make use of the upcoming bonus spherical to push out underperformers in areas reminiscent of funding banking and wealth administration, probably together with managing administrators, the report mentioned, citing in line with individuals accustomed to the matter.
While HSBC has not confirmed any remaining choices relating to plans to cull underperformers, Morningstar’s Chan mentioned she wouldn’t be stunned to see additional headcount reductions, given the Group’s broader purpose to enhance operational effectivity and ship price financial savings.
Hong Kong listed shares of HSBC declined 0.46%.
—CNBC’s Emily Tan contributed to this report.
