By Martin Mou 
 

HSBC Holdings PLC's net profit fell sharply in 2020 as the coronavirus ravaged the global economy, causing expected credit losses to surge and interest rates to drop.

Net profit slid 35% to $3.9 billion from $5.97 billion, while revenue dropped 10% to $50.43 billion, the London-based bank with Asian roots said Tuesday.

However, the lender swung to net profit for the fourth quarter from the year-ago period, when a goodwill impairment led to a heavy loss. Net profit for the quarter ended Dec. 31 came in at $562 million compared with a net loss of $5.51 billion a year earlier.

A FactSet poll of analysts had tipped a net loss of $115 million for the quarter.

HSBC plans to further lower its costs, targeting an adjusted cost base of $31 billion or less in 2022.

Meanwhile, the bank no longer expects to reach its target for return on average tangible equity at between 10% and 12% in 2022. It now seeks to achieve a return ratio of greater than or equal to 10% in the medium term.

HSBC declared an interim dividend for the year of $0.15 per ordinary share.

 

Write to Martin Mou at martin.mou@wsj.com

 

(END) Dow Jones Newswires

February 22, 2021 23:56 ET (04:56 GMT)

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