HSBC first-quarter profits more than double to $6.4bn

HONG KONG: HSBC said on Tuesday that first-quarter profits more than doubled, helped by a reversal in credit losses as well as its major restructuring and pivot to Asia.

Adjusted profit before tax rose 109 percent to $6.4 billion although reported revenue slipped five percent on year to $13.0 billion thanks in part to low interest rates.

The results, which beat estimates, are a shot in the arm for the Asia-reliant lender after a tumultuous year that saw its fortunes take a hammering from the coronavirus and simmering geopolitical tensions.

"I am pleased with our revenue and cost performance, but particularly with our significantly lower expected credit losses," Chief Executive Officer Noel Quinn said in a statement.

Quinn struck a cautiously optimistic note for the near future with hopes high that mass vaccinations may start to ease pressure on the global economy, even as infections continue to soar.

"The economic outlook has improved, although uncertainties remain," he said.

Bright spots included a $400 million reversal in credit losses and all regions reporting profits, including the UK where pre-tax profits were more than $1.0 billion for the quarter.

Like all banking giants HSBC was battered by the coronavirus last year with a 30 percent plunge in 2020 profit.

Under Quinn, HSBC has embarked on a dramatic restructuring.

It has rolled out plans to cut its workforce by about 35,000 to drive down costs and to refocus on its most profitable areas -- Asia and the Middle East.

HSBC makes 90 percent of its profit in Asia, with China and Hong Kong the major drivers of growth.