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HSBC defies Asia slowdown, for now

Monday, November 02, 2015 - 01:41

HSBC has reported a better than expected 32 percent rise in pretax profit for the third quarter, with a drop in fines for past misconduct countering the impact of a slowdown in Asia. As Ciara Lee reports Germany's Commerzbank also reported better than expected results, promising to pay its first dividend in eight years.

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With a focus on Asia and a slowdown in the region - HSBC has a few new challenges. But Europe's biggest bank reported a 32 percent rise in pretax profit for the third quarter. The 6.1 billion dollar profit is partly thanks to a drop in misconduct fines and less compensation to customers. But declining revenue is still an issue. It fell 4 percent compared with the same quarter last year, due to that slow growth in Asia. That prompted shares to fall over half a percent - they've now fallen 17 percent this year. BGC Partner's Mike Ingram. (SOUNDBITE) (English) MARKET STRATEGIST AT BGC PARTNERS, MIKE INGRAM, SAYING: "Yes it is positive news on the regulatory front. It's positive news on some of the costs that they have been baring over recent years. But I don't think we are necessarily heading for a significant rebound." It was a different story at Germany's Commerzbank. It's to pay a dividend for the first time since 2007. Beating analyst expectations in third quarter profits, shares rose three percent. It comes just a day after the architect of the bank's turnaround announced he would step down next year. CEO Martin Blessing has spent most of his time restructuring the lender after its near-collapse during the financial crisis. (SOUNDBITE) (English) MARKET STRATEGIST AT BGC PARTNERS, MIKE INGRAM, SAYING: "A change of government is always particularly troubling but I don't think the transition here will be a major issue. And certainly investors are more focuses on the operating results." In Spain, bailed-out lender Bankia reported a drop in net lending revenues. Lower charges against loan losses did help to counter weaker revenue. But like its Spanish rivals, it is suffering from a prolonged period of low interest rates and intense competition.

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HSBC defies Asia slowdown, for now

Monday, November 02, 2015 - 01:41