HSBC Worried About Trump Trade Policy as Net Loss Widens--Update
February 21 2017 - 3:44AM
Dow Jones News
By Margot Patrick and Joanne Chiu
HSBC Holdings PLC warned that a changed U.S. stance on global
trade could harm its business as it reported worse than expected
fourth-quarter results Tuesday.
The Asia-focused lender's net loss widened sharply to $4.23
billion in the three months to end-December from $1.33 billion in
the same period the year before on around a 24% decline in revenue
to $8.98 billion. The bank also booked a series of charges
including one for goodwill impairment at its slimmed-down private
bank.
HSBC said it would buy back as much as $1 billion in shares,
adding to $2.5 billion bought back last year, and left the door
open for further buybacks as capital is freed up at its U.S.
business this year.
Chairman Douglas Flint said possible protectionist measures from
the new U.S. administration under President Donald Trump could have
an impact on global trade, adding to other political uncertainties
for the bank including the U.K.'s planned exit from the European
Union.
Chief Executive Stuart Gulliver said in an interview that any
U.S. protectionism "at first blush is negative to us," though it
might be countered by growing intra-regional trade in Asia and
elsewhere.
HSBC's Hong Kong-listed stock fell 4% on Tuesday. The stock had
gained around 49% as of Monday since its recent trough in mid-June,
mainly on expectations that future U.S. interest-rate rises will
lift margins and revenue.
HSBC has undergone a major restructuring since 2011 under the
leadership of Mr. Gulliver and Mr. Flint, exiting from most of
Latin America and placing more focus on Asia. Mr. Flint is set to
step down after a replacement is announced this year, and then the
new chairman will seek a successor to Mr. Gulliver. There was no
update on that plan Tuesday.
The global banking major's full-year net profit was $1.30
billion, down sharply from net profit of $12.6 billion in the
previous year. Full-year revenue fell more than 19% to $47.97
billion.
Write to Margot Patrick at margot.patrick@wsj.com and Joanne
Chiu at joanne.chiu@wsj.com
(END) Dow Jones Newswires
February 21, 2017 03:29 ET (08:29 GMT)
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