HSBC sets aside $378 million for forex probe
HSBC Holdings missed expectations with a 12% drop in underlying third-quarter earnings and set aside $378 million to cover a potential fine from the UK regulator for alleged manipulation of currency markets.business Updated: Nov 03, 2014 15:14 IST
HSBC Holdings missed expectations with a 12% drop in underlying third-quarter earnings and set aside $378 million to cover a potential fine from the UK regulator for alleged manipulation of currency markets.
Europe's largest bank blamed higher costs, up 6%, for the slide in earnings. In addition to the forex probe, it set aside more money to cover the cost of compensating customers in Britain for mis-selling loan insurance and agreed a $550 million settlement with the US Federal House Finance Agency.
The bank also said it had been summoned to appear before French magistrates over whether its Swiss private bank had helped French citizens to evade tax.
Analysts were expecting statutory pretax profits to rise by 16% in the quarter compared with last year but they rose just 2% to $4.6 billion. Shares fell more than 3 percent when the results were announced.
The bank's $378 million provision for the forex probe is for a possible settlement with Britain's Financial Conduct Authority, which HSBC said had proposed a resolution of its investigation into alleged manipulation in the global currency markets.
HSBC is one of six banks in talks with UK regulators to pay about 1.5 billion pounds in a group settlement, sources have said.