HSBC dives into the red and is being probed over ‘princelings’

Comments Off on HSBC dives into the red and is being probed over ‘princelings’

Shares in HSBC dropped 4% after it missed City profit forecasts and revealed a probe by US regulators into its hiring of “princelings” —relations of Chinese politicians — in the Far East. 

Analysts were particularly disappointed by a fourth-quarter plunge into the red from profits of $1.7 billion (£1.2 billion) to losses of $858 million. 

A large part of that was from an unexpected $634 million increase in bad debt writedowns, mainly on loans to oil and gas businesses, and a $357 million rise in the UK bank levy.

Only last week HSBC finally declared it would remain headquartered in London thanks partly to the Chancellor’s cut in how much levy it will pay in future. 

But investors were spooked by news of a new investigation into the bank on top of those ranging from forex rigging to alleged money laundering for Fifa. 

HSBC revealed it is being investigated by the Securities and Exchange Commission in the States over “hiring practices of candidates referred by or related to government officials or employees of state-owned enterprises in Asia-Pacific”.

It gave no more details of the numbers involved or potential penalties. A similar case started three years ago against JPMorgan is expected to result in a significant fine this year. While full-year profits at HSBC rose by 1% to $18.9 billion, its adjusted profits were down by 7% at $20.4 billion on higher costs. 

Chief executive Stuart Gulliver, whose pay has been cut from  £7.6 million to £7.3 million, still believes he can deliver $5 billion of savings by 2017. The dividend is up by one cent to 51 cents a share. The shares fell 18p to 431.8p.

Source Article from http://www.standard.co.uk/business/business-news/hsbc-dives-into-the-red-and-is-being-probed-over-princelings-a3186011.html

February 23, 2016 |
Copyright © 2018 LondonBusinessLink.co.uk. All Rights Reserved. LondonBusinessLink.co.uk
WordPress Directory Theme

Classified Ads Software

We use cookies to ensure that we give you the best experience on our website.
More about our cookies
Ok
Skip to toolbar