HSBC shares rise 3% after profit beat, $3 billion buyback announcement

LONDON — Europe's largest lender HSBC on Wednesday declared a share buyback program of up to $3 billion, as pretax profit for the first half of the year beat expectations on the back of a high-interest rate environment.

The bank posted pretax profit in the six months to June of $21.56 billion, down from $21.66 billion in the same period of last year. The first-half figure nevertheless came in well above the $20.5 billion average of broker estimates compiled by HSBC, according to Reuters.

London-listed shares of HSBC picked up 3.12% at 08:42 a.m. London time, just after local markets opened, while Hong Kong-listed shares were up roughly 4.4%.

"We are growing and investing in our international retail and wealth business to sit alongside this, which is helping to diversify revenue," HSBC's outgoing CEO Noel Quinn said Wednesday.

"Each of these strengths contributed to a good revenue performance in the first half of 2024, supported by higher interest rates."

The bank's revenue was up 1.1% year-on-year to $37.3 billion, in a performance HSBC attributed to the "impact of higher consumer activity in our Wealth products in Wealth and Personal Banking ('WPB'), and in Equities and Securities Financing in Global Banking and Markets ('GBM')."

The lender's wealth revenue picked up by 12% to $4.3 billion in the first six months to June, with noted growth in investment distribution, asset management and life insurance.

The bank outlined its priorities of diversifying its revenues and maintaining a firm foothold in what it described as its "critical" home markets of Hong Kong and the U.K. — it noted 345,000 new-to-bank customers opening accounts in the former region in the first half of the year, with international customers up 8% to 2.7