HSBC Records $4.6bn Profit for Q1 2021

HSBC Holdings plc​ (LON:HSBA) announced its financial results for Q1 2021, recording a steep rise in profit by 82% to $4.6bn.

As the results show, reported profit before tax increases by 79% to $5.8bn, compared to data for Q1 2020. In addition, adjusted profit before tax increases by 109% to $6.4bn.

Reported revenue reaches $13.0bn, 5% lower than a year earlier due to the impact of 2020 interest rate reductions in all global businesses. This was partly offset by market impacts in life insurance manufacturing and valuations in GBM.

In Markets and Securities Services, revenue increased by $0.1bn or 6% due to favourable movements in credit and funding valuation adjustments of $0.4bn and as 1Q20 included a $310m adverse bid-offer adjustment. Revenue in Global Debt Markets and Equities increased, particularly in wealth and private credit, reflecting robust client activity.

These increases more than offset lower revenue in Global Foreign Exchange, which was in the context of a particularly strong performance in 1Q20. Securities Services revenue fell by $0.1bn or 14% due to lower interest rates, notably in Asia and Europe, while fees were up 6%, mainly in Asia.

“We had a good start to the year in support of our customers, while achieving materially enhanced returns for our shareholders. I am pleased with our revenue and cost performance, but particularly with our significantly lower expected credit losses. Global Banking and Markets had a good quarter, and we saw solid business growth in strategic areas, including Asia Wealth and trade finance, and mortgages in Hong Kong and the UK. We also strengthened our lending pipelines in our retail and wholesale businesses. The execution of our growth and transformation plans is proceeding well. We made further progress in reducing both costs and risk-weighted assets, and launched new products and capabilities in areas of strength. The economic outlook has improved, although uncertainties remain. We carry good momentum into the second quarter, while maintaining conservative positions on capital, funding, liquidity and credit”, Noel Quinn, Group Chief Executive said.