HSBC reports a drop in profits, warns of restructuring
The bank will accelerate a shake-up after a poor performance from some divisions, stocks fall 3%
Stocks impacted: HSBC Holdings Plc (HSBA)
The company reported that its pre-tax profits fell 18% to $4.8bn for the three months to the end of September compared with the same period last year and were lower than the $5.3bn expected by analysts. The lender dropped its 2020 profit target and warned it would have to undertake costly restructuring, as it struggles amid uncertainty arising from Brexit, the US-China trade war and ongoing unrest in Hong Kong. As a reminder, HSBC is listed in London and Hong Kong. The bank, which generates the bulk of its revenue and profit in Asia, would shift capital away from low-return businesses and further cut costs by simplifying the company’s complicated management structure. After the announcement, the stocks declined 3%.
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