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HomeFT SelectHSBC profit tumbles on writedowns and one-off costs

HSBC profit tumbles on writedowns and one-off costs

One-off costs and multibillion-dollar writedowns have dragged down HSBC’s full-year profit 62 per cent year-on-year to $7.1bn, as the London-headquartered lender extended its share buyback programme by an additional $1bn.

The British bank blamed slowing economic growth in its main markets of Hong Kong and the UK for the profit slide, as well as a $3.2bn impairment of goodwill to its private banking unit in Europe, and the impact of the sale of operations in Brazil.

“This decline principally reflected the impact of significant items, most of which had no impact on capital, even though they were material in accounting terms,” said Douglas Flint, the bank’s chairman.

The pre-tax profit of $7.1bn for 2016 was less than half of analysts’ consensus forecast of $14.4bn, according to Thomson Reuters data, and was well down on the $18.9bn reported in 2015.

On an adjusted basis, pre-tax profit dropped 1 per cent year-on-year to $19.3bn.

Via FT