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HSBC may leave UK, warns on global slump
Europe’s biggest bank HSBC on Wednesday said costly new capital rules might force it to leave the UK, as it reported a bigger-than-expected fall in third-quarter profit, hit by lower investment banking income and higher bad debt in the US.
Europe’s biggest bank HSBC on Wednesday said costly new capital rules might force it to leave the UK, as it reported a bigger-than-expected fall in third-quarter profit, hit by lower investment banking income and higher bad debt in the US.
The bank said its underlying pretax profit was 36% lower at $3 billion in the three months ended September, sending its shares down more than 5% in early trade.
“Trading conditions showed some improvement during October, but they remain very difficult and continuing turbulence in global markets may result in further downside risk,” the bank said in a statement.
HSBC chief executive Stuart Gulliver aims to cut annual costs by $3.5 billion and sharpen its focus on Asia, quitting countries where the bank lacks scale in an attempt to revive profitability.
The bank also said that the cost of UK regulatory reform could be $2.5 billion, and that it might move its headquarters out of the country where it has been based for the last 20 years or so.
HSBC said loan impairment charges and other credit risk provisions were $0.7 billion higher at the end of the quarter compared to a year ago.
