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HSBC warns of 'challenging' outlook as profit falls | HSBC warns of 'challenging' outlook as profit falls |
(about 2 hours later) | |
HSBC said the bank's performance in parts of Europe and the US was "not acceptable" as it posted a drop in third quarter profit. | |
Europe's largest bank said profit before tax fell 18% to $4.8bn (£3.8bn) in the three months to September, missing analyst estimates. | |
In a statement, the bank also warned of a "challenging" environment ahead. | |
HSBC has been navigating uncertainty arising from Brexit, the US-China trade war and ongoing unrest in Hong Kong. | |
Shares fell 2.7% in Hong Kong trading after the earnings release. | |
Noel Quinn, who took over as HSBC's acting chief executive after the shock departure of John Flint in August, praised the performance in Asia but criticised other regions. | |
The bank makes most of its profits in Asia. | |
"Parts of our business, especially Asia, held up well in a challenging environment in the third quarter," said Mr Quinn. | |
"However, in some parts, performance was not acceptable, principally business activities within continental Europe, the non-ring-fenced bank in the UK, and the US." | "However, in some parts, performance was not acceptable, principally business activities within continental Europe, the non-ring-fenced bank in the UK, and the US." |
Mr Quinn said previous plans to improve the performance of these businesses were "no longer sufficient" and that they are "accelerating plans to remodel them". | |
The bank also said the revenue environment was "more challenging" than in the first half of the year, and predicted "softer" revenue growth than previously anticipated. | |
It also warned of "significant charges" in the fourth quarter - including related to restructuring - if the backdrop worsened further. | |
Asia performance | |
While HSBC warned earlier this year that profits would be hit by a slowdown in China, the broader region was profitable for the bank in the third quarter. | |
The bank said profit before tax in Asia rose 4% to $4.7bn in the period, citing "resilience" in Hong Kong. | |
It follows months of unrest in the territory that have raised concerns about the impact on the economy and the reputation of the Asian financial hub. |