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Banks

HSBC returns US$2.5bn to investors despite profit dip

Banking giant made first-half pre-tax profit of US$9.7bn, down US$3.9bn versus a year ago

HSBC Holdings PLC (LON:HSBA) reported lower profits but sweetened the bitter pill with a pledge to hand back up to US$2.5bn to shareholders in the second half.

The banking giant made a reported pre-tax profit of US$9.7bn in the first half, down by US$3.9bn on the same period a year ago.

Adjusted pre-tax profits were US$10.8bn, down US$1.75bn, which the bank described as a "reasonable performance in the face of considerable uncertainty".

Adjusted revenue of US$27.9bn was down 4% compared with a strong first half last year.

The group gained market share in key Asian territories and businesses, and vowed to sustain its annual ordinary dividend.

It attributed the share buyback to the successful disposal of HSBC Bank Brazil on July 1.

Chief executive Stuart Gulliver said: "Following the successful sale of our Brazil business and having received the appropriate regulatory clearances, I am pleased to announce we will execute a share buy-back of up to US$2.5bn, which should benefit all shareholders and demonstrates the strength and flexibility of our balance sheet. We performed reasonably well in the first half.

"While economic conditions remain difficult, we are making progress in all the areas within our control."

Reported and adjusted operating expenses fell and the group made run-rate savings of more than US$2bn since it launched a cost-cutting programme.

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