HSBC, the largest European bank by assets, reported a net attributable profit of 10,202 million dollars for the first nine months of 2022. The firm noted that in the same period of 2021 the profit stood at 10,353 million euros, reflecting a 5.7 percent decline year over year.
In November 2021 the bank’s European arm entered into a framework agreement with Promontoria, also known as My Money Group, and its subsidiary Banque des Caraïbes. The deal outlined the planned sale of the organization’s retail banking business in France and was expected to close in the second half of 2023. HSBC also recorded an estimated impairment of 2,435 million euros in connection with that transaction.
By the end of September HSBC’s turnover reached 36,852 million dollars, equivalent to 37,397 million euros. Net interest income declined by 16.9 percent to 23,032 million dollars, or 23,372 million euros, while commission income fell 11.5 percent to 8,847 million dollars, reflecting a 1.9 percent drop from the previous year’s corporate activity.
A weaker revenue quarter contributed to a 2.1 billion dollar negative impact, or 2,131 million euros, driven by unfavorable exchange rate movements and asset depreciation linked to the planned asset restructuring. This was partly offset by an increase in net interest income of 3,300 million dollars, about 3,349 million euros, following the anticipated divestment of the French retail banking operations.
From July to September HSBC generated a net attributable profit of 1,913 million dollars, roughly 1,941 million euros, which is 46 percent below the prior year. During the same period, turnover slipped 3.3 percent to 11,616 million dollars, about 11,788 million euros.
In the third quarter net interest income rose by 29.8 percent to 8,581 million dollars, or 8,708 million euros, while fee income fell 16.2 percent to 2,783 million dollars, about 2,824 million euros.
The leadership highlighted strong organic growth across all three global business lines, noting that higher interest rates supported net interest income, a result of its disciplined approach to growth and capital management.
The bank outlined a plan to deliver a targeted return on equity of at least 12 percent by 2023, with the expectation of higher cash distributions to shareholders as a consequence of that strategy.
Looking ahead, HSBC projected a positive earnings trajectory with total net interest income anticipated to rise as market conditions evolve. The institution estimated a full-year 2022 net interest income around 32.4 billion euros, based on prevailing central bank rate expectations, and signaled a view that 2023 could see net interest income approaching 36.5 billion euros, albeit with sensitivity to the pound’s movements against the dollar and funding costs in the trading book.