exceeds expectations, CEO Noel Quinn resigns

HSBC beat market expectations in its first-quarter earnings report on Tuesday and announced the surprise departure of group chief executive Noel Quinn.

Revenue was $20.8 billion, up 3% from the same period a year ago and compared with LSEG’s average forecast of about $16.94 billion.

Pre-tax profit for the January-March period was $12.65 billion, down about 2% from a year ago, when pre-tax profit was $12.89 billion. However, the figure beat the bank’s analyst estimate of $12.61 billion

Profit after taxes fell to $10.84 billion, lower than $11.03 billion in the first quarter of 2023.

HSBC, Europe’s largest bank by assets, has approved an first interim dividend of 10 cents per share, as well as a special dividend of 21 cents per share, following the completion of the sale of its banking business in Canada.

The company also announced the departure of Quinn, who held the position for nearly five years.

“The Board would like to pay tribute to Noel’s leadership of the company. Noel has a long and distinguished 37-year career with the Bank and we are very grateful for his significant contribution to the Group over many years,” said Group Chairman Mark. Tucker.

“During his tenure, HSBC achieved record profits and its highest revenue for more than a decade,” said Eileen Taylor, HSBC group secretary and chief operating officer.

Quinn will remain group CEO as the bank begins the search process for his successor. HSBC said it has agreed to remain available until the end of the 12-month notice period, ending April 30, 2025, to support the transition.

Here are other highlights from the bank’s first-quarter financial report:

• Net interest marginthe lending profitability indicator decreased to 1.63% – compared to 1.69% a year ago.
• Tier 1 common capital ratio — which measures a bank’s capital relative to its assets — was 15.2%, down from 14.8% in the fourth quarter of 2023.
• Basic earnings per share was $0.54, slightly higher than $0.52 in the same period a year ago.

HSBC also confirmed its forecast for 2024, saying it was unchanged from its February forecast.

The bank continues to target average tangible capital returns to be in the “teens” by 2024, with net bank interest income of at least US$41 billion based on global interest rates.

HSBC said its CET1 capital ratio is expected to be within its medium-term target range of 14% to 14.5% and its dividend payout ratio is targeted at 50% for 2024, excluding significant material items and related impacts. .

Following the action, HSBC shares in Hong Kong rose 1.56%, posting gains for the seventh day in a row.

Correction: This story has been updated to accurately reflect that HSBC’s revenue in the first quarter of 2024 was 3% higher than a year ago. This figure was skewed due to an editing error.