London Daily

Focus on the big picture.
Saturday, Oct 04, 2025

HSBC boss: bank underperforming in Europe

HSBC boss: bank underperforming in Europe

Performance in Hong Kong, which has been battered by nearly five months of grinding political unrest, remained ‘resilient’.

HSBC’s interim chief executive on Monday said the banking giant was underperforming in parts of Europe and the United States, as third-quarter profits slipped and the lender warned of further headwinds.

The Asia-focused behemoth has been trying to lower costs as it faces the double uncertainties caused by the grinding US-China trade war and Britain’s impending departure from the European Union.

Noel Quinn, who took over as acting CEO after the shock ouster in August of John Flint, has overseen plans to axe some 4,000 jobs, primarily away from its more profitable businesses within the Greater China region.

“Parts of our business, especially Asia, held up well in a challenging environment in the third quarter,” Quinn said in a statement attached to the bank’s latest results.

“However, in some parts, performance was not acceptable, principally business activities within continental Europe, the non-ring-fenced bank in the UK, and the US,” he added. (Ring-fencing occurs when a portion of a company’s assets or profits are financially separated without necessarily being operated as a separate entity.)

The results statement gave no concrete details of what further restructuring may be down the line and said investors would be updated before February 2020, when the full 2019 results are released.

But Quinn, who has signalled he wants the top job on a permanent basis, hinted at more pain ahead in the coming months.

“Our previous plans are no longer sufficient to improve performance for these businesses, given the softer outlook for revenue growth,” he said.

“We are therefore accelerating plans to remodel them, and move capital into higher growth and return opportunities.”

Bloomberg News has reported that the bank may look to partially exit stock trading in some developed Western markets, and will attempt to sell its French retail bank.


Forecasts missed

In the results, pre-tax profit slipped 18 percent on-year to $4.8 billion in July-September with the vast majority – $4.7 billion – coming from Asia, according to the statement.

Adjusted pretax profit fell 12 percent to $5.3 billion, net profit fell by 24 per cent to $3 billion and revenue slipped 3.2 percent to $13.4 billion, all missing analyst forecasts.

The bank said its performance in Hong Kong – which has been battered by nearly five months of grinding political unrest – remained “resilient”.

HSBC is uniquely tethered to Hong Kong’s fortunes, pitching itself as a gateway to mainland China but leaving much of its core business potentially vulnerable to the city’s political chaos.

A bright spot for investors was pretax profit in Hong Kong creeping up one percent in the third quarter to $3 billion. But the bank also flagged a charge of $90 million to reflect a deteriorating economic outlook in the city.

On Sunday, Hong Kong’s financial secretary warned the city was likely to end the year in recession because of the ongoing pro-democracy protests.

Overall HSBC warned the second half of the year looked set to be less rosy that the first half, when the bank reported net profit was up 18.6 percent at $8.5 billion from a year earlier.

“The revenue environment is more challenging than in the first half of 2019, and the outlook for revenue growth is softer than we anticipated at the half-year,” the London-based firm said in its statement.

It also warned it was unlikely to hit a key profit target.

The bank had been hoping to deliver a more than 11 percent return on tangible equity by 2020, a target it said it now “no longer expected to reach.”

RoTE came in at 6.4 per cent compared with 10.9 percent for same period a year earlier.

In afternoon trading on the Hong Kong stock exchange, HSBC’s shares were down 2.3 percent.

Newsletter

Related Articles

0:00
0:00
Close
Trump Administration Launches “TrumpRx” Plan to Enable Direct Drug Sales at Deep Discounts
Trump Announces Intention to Impose 100 Percent Tariff on Foreign-Made Films
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Singapore and Hong Kong Vie to Dominate Asia’s Rising Gold Trade
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Manhattan Sees Surge in Office-to-Housing Conversions, Highest Since 2008
Switzerland and U.S. Issue Joint Assurance Against Currency Manipulation
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Thomas Jacob Sanford Named as Suspect in Deadly Michigan Church Shooting and Arson
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
New York Man Arrested After On-Air Confession to 2017 Parents’ Murders
U.S. Defense Chief Orders Sudden Summit of Hundreds of Generals and Admirals
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
Trump Claims FBI Planted 274 Agents at Capitol Riot, Citing Unverified Reports
India: Internet Suspended in Bareilly Amid Communal Clashes Between Muslims and Hindus
Supreme Court Extends Freeze on Nearly $5 Billion in U.S. Foreign Aid at Trump’s Request
Archaeologists Recover Statues and Temples from 2,000-Year-Old Sunken City off Alexandria
China Deploys 2,000 Workers to Spain to Build Major EV Battery Factory, Raising European Dependence
Speed Takes Over: How Drive-Through Coffee Chains Are Rewriting U.S. Coffee Culture
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Ringo Starr Champions Enduring Beatles Legacy While Debuting Las Vegas Art Show
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
FBI Removes Agents Who Kneeled at 2020 Protest, Citing Breach of Professional Conduct
Trump Alleges ‘Triple Sabotage’ at United Nations After Escalator and Teleprompter Failures
Shock in France: 5 Years in Prison for Former President Nicolas Sarkozy
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
BNP Paribas Abandons Ban on 'Controversial Weapons' Financing Amid Europe’s Defence Push
Typhoon Ragasa Leaves Trail of Destruction Across East Asia Before Making Landfall in China
The Personality Rights Challenge in India’s AI Era
Big Banks Rebuild in Hong Kong as Deal Volume Surges
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Arnault Denounces Proposed Wealth Tax as Threat to French Economy
Study Finds No Safe Level of Alcohol for Dementia Risk
Denmark Investigates Drone Incursion, Does Not Rule Out Russian Involvement
Lilly CEO Warns UK Is ‘Worst Country in Europe’ for Drug Prices, Pulls Back Investment
Nigel Farage Emerges as Central Force in British Politics with Reform UK Surge
Disney Reinstates ‘Jimmy Kimmel Live!’ after Six-Day Suspension over Charlie Kirk Comments
U.S. Prosecutors Move to Break Up Google’s Advertising Monopoly
Nvidia Pledges Up to $100 Billion Investment in OpenAI to Power Massive AI Data Center Build-Out
U.S. Signals ‘Large and Forceful’ Support for Argentina Amid Market Turmoil
Nvidia and Abu Dhabi’s TII Launch First AI-&-Robotics Lab in the Middle East
Vietnam Faces Up to $25 Billion Export Loss as U.S. Tariffs Bite
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Indonesia Court Upholds Military Law Amid Concerns Over Expanded Civilian Role
Larry Ellison, Michael Dell and Rupert Murdoch Join Trump-Backed Bid to Take Over TikTok
Trump and Musk Reunite Publicly for First Time Since Fallout at Kirk Memorial
Vietnam Closes 86 Million Untouched Bank Accounts Over Biometric ID Rules
×