Geoghegan calls bottom as HSBC signals higher profits
HSBC chief executive Michael Geoghegan yesterday stuck his head above the parapet by definitively calling an end to the crisis, as the bank revealed third quarter profits were “significantly ahead” of last year.
“I believe that the biggest jolt has now passed through the global economy,” Geoghegan said. “But it is too early to claim victory, especially while unemployment is still rising in the West. The world will likely experience a two-speed recovery and emerging markets currently offer the brightest prospects for growth.”
HSBC, which focuses on emerging markets in Asia, said its strong third quarter performance was boosted by strength in its investment bank, Global Banking and Markets, which it said “maintained its record performance for the year to date”.
HSBC also said loan impairment allowances had peaked earlier in the year, with losses on bad debts in the third quarter at their lowest level since the first half of 2008.
But Geoghegan also warned action by the UK government to tighten regulation threatens to damage the competitiveness of City banks.
“It is clear that careful international co-ordination is crucial if changes are to be introduced in a rational way which maintains market confidence and a level playing field,” he said.