London-headquartered HSBC recorded a surge in annual profits due to the sale and acquisition of businesses as well as income growth.
HSBC posted a pre-tax profit of $30.3 billion for 2023, according to the bank’s annual report, marking a 78 percent increase compared to 2022.
Revenue rose by 30 percent to $66.1 billion, driven partly by the sale and acquisition of businesses. This includes a favorable impact of $2.5 billion associated with the sale of the retail banking operations in France as well as a $1.6 billion provisional gain from the acquisition of Silicon Valley Bank (SVB). This was partly offset by $3 billion of impairment charges relating to investment in China’s Bank of Communications.
Operating Income
In addition, the bank also recorded a $5.4 billion increase in net interest income due to rising rates which resulted in a 24 basis points boost in net interest margin to 1.66 percent. Non-interest income increased by $10 billion, reflecting a rise in trading and fair value income of $6.4 billion, mainly in global banking and markets.
Operating expenses fell 2 percent to $32.1 billion, primarily driven by the non-recurrence of restructuring and other related costs.
Dividend, Buyback
HSBC’s board approved a fourth interim dividend of $0.31 per share, resulting in a dividend of $0.61 per share – the highest since 2008. The bank also conducted three share buybacks totaling $7 billion with a further share buyback of up to $2 billion.
«We have a strong platform for growth with the opportunities that exist within our two home markets and across our international wholesale, market-leading transaction banking and wealth management businesses,» said HSBC group CEO Noel Quinn. «We are focused on capturing these growth opportunities, improving our earnings sustainability and targeting mid-teens returns in 2024.»
