HONG KONG – HSBC’s financial performance was positive in the third quarter of 2024, as the group’s profit before tax increased by 10 percent year-on-year to $8.5 billion and revenue rose by 7 percent to $17 billion.

According to its third quarter earnings release, the increase in profit before tax is primarily due to revenue growth in the group’s wealth and personal banking, foreign exchange, equities and global debt market arms.

“There was strong revenue growth and good performances in wealth and wholesale transaction banking,” HSBC’s CEO Georges Elhedery said, after delivering the first set of results since his promotion on September 2.

The board of HSBC has approved a third interim dividend of $0.1 per share.

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Meanwhile, HSBC is actively repurchasing its shares as well. The group just completed a $3 billion share buy-back and intends to initiate another share buy-back of up to $3 billion, which is expected to complete within the four-month period before its 2024 full-year results announcement.

“Our strong organic capital generation enables us to announce a further $4.8 billion of distributions (of dividends and buy-backs) in the third quarter, which brings the total distribution announced so far in 2024 to $18.4 billion,” Elhedery said.

Strong financial performance underscores Elhedery’s plan to simplify the group’s organizational structure. Effective in 2025, the bank’s four business lines will be: Hong Kong, the UK, corporate and institutional banking, and wealth and premier banking.

However, it is worth noting that the bank group’s net interest income fell by $1.6 billion to $7.6 billion, reflecting reductions due to business disposals, higher interest expenses on liabilities and a loss on the early redemption of legacy securities.

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Its operating expenses also rose by 2 percent on a yearly basis to $8.1 billion. The growth was primarily due to higher spend and investment in technology and the impacts of inflation.

Jefferies Group, an international financial service provider, noted in a report that HSBC announced stable performance in the third quarter of this year, with pre-tax profit exceeding expectations by 12 percent. Non-interest income performed strongly, but net interest income fluctuated slightly.

Looking ahead, the bank’s net interest income guidance of around $43 billion for 2024 remains unchanged and it continues to target cost growth of approximately 5 percent for 2024 compared with 2023, on a target basis.

Contact the writer at thor_wu@chinadailyhk.com