Banking giant HSBC said on Tuesday that pre-tax profit rose 16 percent to $19.9 billion last year with growth across its global businesses despite a “challenging external environment in the fourth quarter”.
The results capped the first full year at the helm of the Asia-focused bank for chief executive officer John Flint, who has vowed growth while keeping a lid on costs as trade tensions between the United States and China rumble.
However, earnings in the last three months of 2018 came in below expectations as Washington’s trade war began to bite globally and hammered the stock markets, especially in Hong Kong and China.
Adjusted pretax profit fell one percent to $3.39 billion in October-December, missing the $4.4 billion consensus average by Bloomberg News derived from estimates compiled by the bank.
Global markets adjusted revenue was down $202 million to $1.1 billion over the same period, while wealth management dropped 18 percent, also to $1.1 billion.
Overall the year saw strong growth for HSBC with net profit ballooning 30 percent to $12.6 billion while adjusted pre-tax profit rose three percent to $21.7 billion.
The bank had to lay off tens of thousands of staff as part of a wide-ranging overhaul that also saw it sell its Brazil operations in 2015.
But it showed a healthy doubling of profits by 2017, a year that also saw it nominate Mark Tucker as chairman, breaking a longstanding tradition of appointing insiders to the post.
In a statement attached to Tuesday’s earnings, Tucker and Flint said the bank was prepared to weather fallout from both a possible deterioration in the trade talks between Washington and Beijing and Britain’s impending departure from the EU.
“The fundamentals for growth in Asia remain strong in spite of a softer regional economic outlook,” Tucker said in a statement attached to the annual report.
“The system of global trade remains subject to political pressure, and differences between China and the US will likely continue to inform sentiment in 2019,” he added.
With Brexit looming, HSBC followed the other major British financial giants in ring-fencing its UK bank.
“We continue to prepare for the UK’s departure from the EU” Flint said, adding its operations in France “gives us a major advantage in this regard”.