Apr 26, 2022
HSBC profits tumble 28% on war in Ukraine and slowing Asia growth
HSBC's profits fell by more than a quarter in the first three months of the year as Europe's largest lender increased its reserves for bad loans in response to Russia's war on Ukraine and suffered slowing growth in its primary Asia markets. The London-based bank reported profit before tax of $4.2bn for the first quarter of the year, a decline of $1.6bn from the same period last year, in part because of a $600mn charge for expected credit losses owing to the war in Ukraine and the slowdown in the Chinese property sector. Profits were also hit by a surge in Covid-19 cases in HSBC's largest market Hong Kong, which resulted in muted equity market activity, bank branch closures and a slowdown in the lender's wealth management division in China, which is at the core of its Asia growth strategy. "The Russia-Ukraine war continues to have devastating consequences both within Ukraine and beyond," said Noel Quinn, HSBC chief executive, in a statement on Tuesday. HSBC said the conflict in Ukraine had "Exacerbated inflationary pressures" and "Increased uncertainty" for the global economic outlook.
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