HSBC reported better-than-expected first-quarter earnings, with revenue of $20.8 billion, up 3% from the same period last year. Pretax profit came in at $12.65 billion, slightly lower than the previous year, but still beating analyst estimates. Profit after tax decreased to $10.84 billion, down from $11.03 billion in the first quarter of 2023. The bank also announced a first interim dividend and a special dividend following the sale of its Canadian banking business.
In a surprising move, HSBC announced the retirement of Group CEO Noel Quinn, who has been in the position for nearly five years. The board expressed gratitude for Quinn’s leadership and significant contributions to the company. Quinn will remain as Group CEO during the search for his successor and has agreed to support the transition through his 12-month notice period, ending April 30, 2025. Under his leadership, HSBC has delivered record profits and strong returns.
Key highlights of the bank’s financial performance include a decrease in net interest margin to 1.63% from 1.69% a year ago, and a common equity tier 1 ratio of 15.2% compared to 14.8% in the previous quarter. Basic earnings per share for the first quarter were $0.54, slightly higher than $0.52 in the same period last year. HSBC reaffirmed its outlook for 2024, targeting a return on average tangible equity in the mid-teens and a dividend payout ratio of 50%.
The bank’s first-quarter results reflect its ongoing efforts to navigate challenges in the global economic environment while maintaining a strong financial position. HSBC’s focus on profitability and capital efficiency has allowed it to weather uncertainties and deliver solid performance. By announcing the departure of Noel Quinn and initiating a search for a new CEO, the bank is signaling a commitment to leadership stability and succession planning.
HSBC’s strategic focus on capital strength, profitability, and sustainable growth underpins its continued resilience in a dynamic market landscape. The bank’s ability to adapt to changing conditions and maintain a strong balance sheet has enabled it to deliver consistent results despite external challenges. With a clear outlook for 2024 and a robust dividend policy, HSBC remains well-positioned to navigate future uncertainties and drive sustainable value for shareholders.
