HSBC Posts Drop In Q3 Profit Before Tax

HSBC Holdings PLC HSBC reported a drop in its profit before tax for the third quarter. HSBC's net profit gained to $4.53 billion versus $3.2 billion, while adjusted pretax profit dropped 12% to $4.4 billion in the third quarter, compared to $5 billion. Analysts projected statutory pretax profit to increase by 16% y/y in the quarter, but it just gained 2% to $4.6 billion in the period. The third quarter included a provision of US$378 million related to the estimated liability in connection with the ongoing foreign exchange investigation by the UK FCA. The latest quarter also included a charge of US$550 million in the US relating to a settlement agreement with the Federal Housing Finance Agency and a provision for UK customer redress of US$701 million. Its adjusted revenue came in flat at $15.58 billion in the quarter. HSBC's operating expenses increased 6%. Net interest income rose to $8.75 billion, versus $8.71 billion. Group Chief Executive, Stuart Gulliver, said, “The third quarter was a period of continued progress. Excluding significant items, we increased underlying profit before tax in all of our global businesses and maintained a strong balance sheet and a robust capital position.” HSBC shares gained 0.10% to $51.07 in pre-market trading.