A pedestrian walks past illuminated signage for HSBC Holdings Plc displayed outside a bank branch in the Central district of Hong Kong, China.
Anthony Kwan | Bloomberg | Getty Images
HSBC on Monday reported a 65% year-over-year fall in pre-tax profits for the first six months of 2020 to $4.3 billion — missing analysts' expectations.
The bank's reported revenue fell by 9% to $26.7 billion during the same period, slightly above what analysts projected.
Chief Executive Noel Quinn said in a statement accompanying the earnings release the bank was "impacted by the Covid-19 pandemic, falling interest rates, increased geopolitical risk and heightened levels of market volatility."
He also cited tensions between the U.S. and China as a challenge that the bank has to manage over the long term.
"Current tensions between China and the US inevitably create challenging situations for an organisation with HSBC's footprint," he added.
HSBC's reported pre-tax profit was forecast to come in at $5.69 billion for the first half of 2020 — or less than half of $12.41 billion that was reported a year ago, according to analyst estimates compiled by the bank. Revenue for the six months was expected to be around $26.41 billion, roughly 10% lower than the prior year's $29.37 billion, the estimates showed.
Its shares, listed in Hong Kong and London, have plunged by more than 40% this year, according to Refinitiv data.
Quinn also said that the bank will "accelerate implementation" of a planned restructuring that he announced in February. The CEO said at that time restructuring would include merging its retail banking and wealth management units, cutting its European equity business as well as reducing branch network in the U.S.
The plan that would result in a reduction of around 35,000 jobs, HSBC announced in February.
The announcement of the bank's financial results follows that of other British banks, many of which reported a slide in profits. British bank Standard Chartered, which is also Asia-focused, on Thursday reported a 33% fall in first-half profits to $1.63 billion.
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August 03, 2020 at 10:09AM
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HSBC's pre-tax profits fall 65% to $4.3 billion in first half of 2020, missing expectations - CNBC
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