Asia Slowdown Concerns Weigh on HSBC
Shares in HSBC Holdings fell on Monday morning, after the bank reported that it had seen a strong increase in earnings - in part due to smaller fines. Unfortunately, the positive report was not enough to bolster the company’s share price, because the increase in profits was not matched by an increase in revenue - the economic slowdown in Asia is adversely impacting the bank’s trading.
The bank has said that it may need to delay its review into where it should be based. It was considering moving its headquarters from London, but the current economic situation makes the move an uncertainty.
The target date for the completion of the review was originally the end of this year, but this is a self-imposed deadline, and it is one that could be moved if the board were to require further work to be performed. The board will be making a final announcement when the full year results are provided, which will most likely be in February of 2016.
So far, the bank has reported pre-tax profits of $6.10 billion for Q3 2015, which is a significant year on year increase over the $4.61 billion from last year. A large part of this can be attributed to last year’s $550 million charge where it settled with the US Federal Housing Finance Authority regarding mortgage bond sales. This year, it paid $28 million to move its ring-fence to its UK retail bank in a bid to separate it from riskier operations in the investment banking sector.