HSBC Beats Profit Report, Announces $2B Share Buyback amid Cost-cutting Measures

By Evans Momodu
3 minute digest
Published 17: 49 UK(GMT) 19 February, 2025

HSBC reported higher-than-expected annual profits on Wednesday, driven by strong performances in wealth and markets divisions. The bank also announced a $2 billion share buyback, set for completion before its next earnings update.

New CEO Georges Elhedery is pushing a restructuring plan to boost efficiency, with $300 million in cost cuts planned for 2025 and a $1.5 billion annualised reduction by 2026. "We are optimising resource allocation across geographies, business lines, and balance sheet management," Elhedery stated.

For 2024, pre-tax profit reached $32.3 billion, up from $30.3 billion last year and exceeding analyst estimates of $31.7 billion. Despite falling interest rates, HSBC’s revenue remained strong.

Following the announcement, HSBC’s Hong Kong-listed shares rose over 1%, while the broader market dipped 0.1%. Analysts welcomed the cost-cutting measures but noted no major restructuring moves.

HSBC’s wealth and personal banking division earned $12.2 billion in pre-tax profit, up 5.2%, while global banking and markets saw a 27% profit increase to $7.1 billion.

The bank declared a fourth interim dividend of $0.36 per share, bringing the 2024 total to $0.87, including a $0.21 special dividend from its Canadian business sale.

Since taking over in September, Elhedery has reshaped HSBC’s structure, cutting senior management and focusing on Asia. He also reduced investment banking in Europe and the Americas, accelerating the bank’s pivot toward its most profitable market.
Source: CNN