HSBC bank says annual net profit drops 16.5 per cent
Profit after tax fell to the equivalent of 10.78 billion euros last year, compared with USD 16.8 billion in 2011, London-headquartered HSBC said in a results statement. Pre-tax profits meanwhile slid six per cent to USD 20.65 billion.
HSBC's performance was hit by a USD 1.9-billion fine to settle US allegations of money laundering that were said to have helped Mexican drug cartels, terrorists and Iran.
The bank had admitted in December to having "inadequate" controls in place and accepted responsibility for the group's past mistakes, as part of an agreement with several US authorities including the US Department of Justice.
HSBC's annual results were also dented by a vast USD 5.2-billion charge against the value of its own debt. And it set aside another USD 1.4 billion to cover compensation in Britain for mis-selling scandals.
However, the lender's capital position improved following a string of asset sales, including its stake in Chinese insurance giant Ping An. As a result, the bank pledged to pay out more in shareholder dividends this year.
And bad debts – or consumer loans that have turned sour – fell to USD 8.31 billion from USD 12.13 billion last time around.
Underlying profits, stripping out exceptional items, climbed by 18 per cent to USD 16.4 billion, with strong growth in Hong Kong and Asia and
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