HSBC profits tumble in face of global uncertainty
Banking giant HSBC has reported a 29% drop in profits on the back of uncertainty in China and the EU.
Chairman Douglas Flint said the fall comes amid a “turbulent period” for the bank.
Pre-tax profits stood at £7.2bn for the first six months of 2016.
Flint said: “The first half of 2016 was characterised by spikes of uncertainty which greatly impacted business and market confidence.
“This was reflected in lower volumes of customer activity and higher levels of market volatility. Concern over the sustainable level of economic growth in China was the most significant feature of the first quarter and, as this moderated, uncertainty over the upcoming UK referendum on membership of the European Union intensified.
“Demand for credit for investment slowed as a consequence. Equity market activity was also markedly lower, particularly in Hong Kong, reflecting both economic uncertainty and weaker market pricing, which was exacerbated by net selling from sovereign funds impacted by lower oil prices.
“The period ended with exceptional volatility as financial markets reacted to the UK referendum decision to leave the EU, a result that had not been anticipated.
HSBC also announced that it will be conducting a share buy-back of up to during the second half of the year after the sale of its Brazilian business Banco Bradesco back in June.