Published Date : Nov 02, 2015
Mr. Stuart Gulliver, the chief executive of HSBC, has expressed pleasure on the economizing trajectory of the bank post its survival in the turmoil happened recently in Chinese stock market. The bank recorded a 1/3rd growth in the pre-tax profits.
According to Mr. Gulliver, the cost-cutting measures implemented by the bank is most likely to gain 90% of the target set for it and would wipe out around US$4.5 bn to US$5 bn of costs by the end of 2017.
HSBC is working on a new strategy, named pivot to Asia, and this target is part of it. The strategy is specifically designed to get rid of underperforming operations in the Americas and Europe and reinvest in rewarding markets.
Mr. Gulliver stated that the trajectory is moving in the right direction and they expect the cost measures that they have already commenced, to gain 90% of their cost targets.
The pre-tax profit of the bank for the quarter, ending on Sep. 30th, 2015 was calculated to be US$6.1 bn, posting a rise from US$4.6 bn a year ago. The pre-tax profit also surpassed consensus forecasts of analysts that were estimated at US$5.2 bn.
The operating expenses also showed a decline from US$11.1 bn to US$9 bn in this quarter, for which exceptional items are to be attributed at large. The exhibited a run rate of US$7.9 bn, cutting its trimestral cost base.
The major contributors to this surprising profit are a decline of US$1.4 bn in settlements, fines, and the customer redress in the U.K. compared to that of during the same time period in 2014