HSBC underlying Q3 profits up sharply, shares rise
Published on Tue, Nov 10, 2009 at 17:12 | Source : Reuters
Updated at Tue, Nov 10, 2009 at 17:31
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HSBC underlying Q3 profits up sharply, shares rise
Europe's biggest bank HSBC Holdings Plc said its underlying third-quarter profits were significantly ahead of a year ago and losses on US consumer loans had shown their first fall in three years.
"Consensus forecasts (for unemployment, house prices) are moving down from some of the more pessimistic figures, if these things all play out, those would be reflective of turning points. But I don't think anyone is confident to call those yet," Finance Director Douglas Flint told reporters.
Overall loan impairment charges and other credit risk provisions declined in the quarter and were at their lowest quarterly level since the second quarter of 2008.
"I believe the biggest jolt has now passed through the global economy," said HSBC Chief Executive Michael Geoghegan. "The world will likely see a two-speed recovery," he said, adding that emerging markets are likely to drive the recovery.
The bank said on a reported basis, including losses on the fair value of its own debt, third-quarter profits were lower than a year ago. The bank said it had seen a further tightening of credit spreads in October, resulting in an additional reduction in the gain from fair-value movements in its own debt.
HSBC also said its US business would announce the sale of its US vehicle loan servicing operations and USD1 billion in vehicle loans to Santander's U.S. operations.
