HSBC’s underlying profits rise despite money laundering fine

By Gerald Heneghan

HSBC has seen its underlying profits rise in 2012, despite the financier being hit by a $1.9 billion (£1.26 million) fine for money laundering.

While overall profits slumped by six per cent year-on -year, the bank saw a boost in business throughout Asia and particularly Hong Kong.

Similarly, it claimed that improving investor sentiment and tightening spreads had contributed to a turnaround in European growth.

Stephen Gulliver, group chief executive at HSBC, hailed the “significant progress” it had made during 2012.

“We increased revenues, performed well in most faster-growing markets and enjoyed a record year in Commercial Banking,” he said.

“We’ve made the business easier to manage and control by disposing of non-core businesses and surpassed our sustainable savings target.”

The financier also weathered a negative fair value adjustment of $5.2 billion on its own debt, counteracting a positive adjustment of $3.9 in 2011.

HSBC enjoyed a record year in its commercial banking efforts and continued to pursue its strategy of growth and restructuring with a view to simplifying its activities.

It saw gains of eight per cent in commercial banking and a six per cent rise in retail banking and wealth management.

More than half of the bank’s revenue came from faster-growing regions and it also accrued sustainable cost savings of $2 billion.

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