LONDON’S BUSINESS NEWSPAPER
LIONESSES ROAR ENGLAND THRASH CHINA 6-1 TO SECURE PLACE IN LAST 16 P18
POKER WORLD SERIES CITY A.M.’S MAN TAKES ON THE PROS P14
HSBC HITS RATE RISE JACKPOT
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WEDNESDAY 2 AUGUST 2023 ISSUE 4,023
BANK LAUNCHES $2BN SHARE BUYBACK AS PROFIT SOARS CHRIS DORRELL
HSBC yesterday smashed expectations in its first set of results since seeing off Ping An’s split campaign, with rising rates helping the bank to record bumper profits. In the three months to June, pretax profit hit $8.8bn (£6.86bn) – over $4bn higher than last year and surpassing the $8bn predicted by analysts. The strong performance reflected the impact of rising interest rates around the world, which helped revenue rise 17 per cent to $16.7bn. Chief executive Noel Quinn (pictured) said: “There was good broad-based profit generation around the world, higher revenue in our
global businesses driven by strong net interest income, and continued tight cost control.” On the back of this, HSBC launched a $2bn share buyback scheme and announced an interim dividend of 10 cents per share. Looking forward, the bank raised its guidance for interest income and its return on tangible equity – a key measure of profitability. “HSBC’s upbeat 2023 outlook… and another $2bn buyback announced [yesterday] confirm its strong outlook,” Tomasz Noetzel, a banking analyst at Bloomberg Intelligence, said. The results are the first since HSBC successfully fought off Ping An’s campaign to spin off the bank’s Asia business, which
generates the vast majority of the lender’s profit. Quinn said yesterday that the vote on the proposal at the company’s AGM in May was a “conclusive and decisive outcome as a vote”. “We’ve moved on from there. We are now very much focused on performance,” he added. Although Ping An’s campaign was defeated, the bank is still exiting a series of markets around the world as it attempts to concentrate on its Asian business. Finance chief Georges Elhedery said HSBC is reviewing exits from as many as a dozen countries. While Quinn said the bank was keeping a close eye on the economic situation in the UK, he said it has only seen “limited signs of stress in the mortgage book”, reinforcing reports from Lloyds, Natwest and Barclays last week.
TOURISM BOOM London to cash in as tourists flock back to the City LAURA MCGUIRE LONDON is this year set to welcome over 2m more international tourists than last year, which is expected to inject an additional £674m into the capital’s economy, according to data from the London Mayor’s office. London is bouncing back from the impact of the pandemic, with the capital already enjoying a very
successful summer. “Our capital is roaring back with tourists from around the world joining Londoners in enjoying all of the fantastic attractions on offer,” Sadiq Khan, Mayor of London, said. “Culture is at the heart of our city, and I’m delighted that our world-renowned theatres, venues, galleries and museums are helping to drive our recovery,” he added.
UK house prices fall at fastest rate in 14 years – but London market ‘stable’ LAURA MCGUIRE THE AVERAGE price of a home fell at the fastest annual rate in 14 years in July, according to new figures published yesterday. House prices fell by 3.8 per cent year on year, according to Nationwide’s house price index – the
biggest drop since July 2009. Nationwide said the average price of a home now costs £260,000, down from £262,000 last month. It comes amid a challenging period for the housing market, which has been dealing with high mortgage rates as the Bank of England hikes interest rates to tame inflation.
“Sellers may have to adjust to the new status quo in the housing market by being flexible on price, given the growing challenges posed by high mortgage rates and inflation,” Myron Jobson, senior personal finance analyst at Interactive Investor, said. Tom Bill, head of UK residential
research at Knight Frank, said that higher borrowing costs “have knocked sentiment and forced buyers to recalculate their budgets”, but added that the property market “hasn’t slammed on the brakes”. In London, however, the picture is slightly different. John Ennis, CEO of London-based
estate agent Chestertons, said the capital’s property market “remained stable” throughout July. “Whilst there were fewer first-time buyers with support from the bank of mum and dad, we witnessed an increase in cash buyers and highervalued property sales in excess of £1m,” he said.
INSIDE UBER HAILS FIRST PROFIT IN COMPANY HISTORY P3 BP REPORTS P4 DIAGEO TOASTS GUINNESS SALES P6 TOYOTA DRIVES UP PROFITS P8 MARKETS P10 OPINION P12-P13