HSBC Q1 Profit Surges, Approves Dividend, Plans Up To $2 Bln Buyback; Backs FY23 Outlook

(RTTNews) - Banking major HSBC Holdings plc (HSBA.L, HSBC) reported Tuesday that its first-quarter profit before tax surged to $12.89 billion from last year's $4.14 billion.

The latest results included a $2.1 billion reversal of an impairment relating to the planned sale of retail banking operations in France, as the completion of the transaction has become less certain, and a provisional gain of $1.5 billion on the acquisition of Silicon Valley Bank UK Limited in March.

Profit attributable to ordinary shareholders of the parent company grew to $10.33 billion from $2.76 billion a year ago.

Revenue increased 64 percent from last year to $20.2 billion, driven by higher net interest income in all of its global businesses due to interest rate rises. It also included the gains related to the transactions in France and the UK. On a constant currency basis, revenue rose 74 percent.

Net interest income grew to $8.96 billion from last year's $6.48 billion. Net interest margin of 1.69 percent increased by 50 basis points compared with last year.

Further, the company said its Board has approved a first interim dividend of $0.10 per share.

HSBC also intends to initiate a share buy-back of up to $2 billion, which is expected to commence following 2023 Annual General Meeting.

Looking ahead for fiscal 2023, the company said its net interest income expectations of at least $36 billion in 2023 are unchanged, based on the current market consensus for global central bank rates.

After including an approximately $2 billion reduction due to the implementation of IFRS 17 'Insurance Contracts', net interest income is expected to be at least $34 billion in 2023.

The company also said it remains confident of achieving return on average tangible equity target of at least 12 percent for 2023 onwards.

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