Monday, May 09, 2011 9:41:56 AM
Last update: 5/9/2011 7:58:10 AM
THE NEWS: HSBC Holdings PLC (HBC) wrapped up the U.K. banks' first-quarter earnings Monday with a disappointing set of results that highlighted the challenges for new Chief Executive Stuart Gulliver to improve the bank's revenue and cuts its costs.
It also weighed in on how much it expects to repay to customers mis-sold payment protection insurance on mortgages and other loans, after Lloyds Banking Group PLC (LYG) shocked the market last week with a GBP3.2 billion provision.
HSBC set aside $440 million and Barclays PLC (BCS) Monday said it is earmarking GBP1 billion to PPI customers.
It was largely a lackluster quarter for the country's banks, with only Asia-focused Standard Chartered PLC (STAN.LN) pleasing the market with record income.
BARCLAYS, reported April 27: First-quarter net profit slipped to GBP1.01 billion from GBP1.067 billion amid a sharp fall in revenue at its Barclays Capital investment-banking unit. Bank executives said uncertainty over coming regulatory requirements is hindering dividend growth, and that reducing credit exposure will be a priority to curb the effects of higher capital charges from 2013 on risky assets.
Barclays said the U.K. bank levy charge will be about GBP100 million for the first quarter. On May 9, it said it is provisioning GBP1 billion for PPI customers.
SANTANDER UK, reported April 28: The U.K. arm of Spain's Banco Santander SA (STD), said higher regulatory and liquidity costs hit profit, for a 2% fall in first-quarter net profit from a year earlier, to GBP419 million. It said it has had to pay more to replace maturing debt, and is holding GBP30 billion more in liquid assets than it did 15 months ago because of tougher liquidity regulation. The bank said it is paying out PPI claims as they arise and doesn't need to make a provision.
STANDARD CHARTERED, reported May 4: The U.K.-based, Asia-focused bank said it made record revenue in the first quarter, from double-digit growth in both retail and wholesale banking. Cost growth is still outpacing revenue growth but narrowing from 2010 levels. The bank repeated guidance that it aims to fully bridge that gap by the end of 2011. Hong Kong, India, Singapore, Malaysia and China all made strong contributions, the bank said. It never sold PPI products.
LLOYDS BANKING GROUP, reported May 5: The 41% state-owned bank made a surprise GBP3.2 billion provision to cover refunds to customers mis-sold payment protection insurance on mortgages, credit cards and personal loans, a higher figure than had been expected and putting pressure on its peers to drop a legal effort to stem costs. Because of the charge, as well as lower retail margins, the bank posted a GBP2.44 billion net loss in the first quarter, compared with a GBP169 million net profit in the first quarter of 2010. Attention is now on a strategic update due at the end of June from new CEO Antonio Horta-Osorio, who gave few clues Thursday on what it might hold.
ROYAL BANK OF SCOTLAND GROUP PLC (RBS), reported May 6: The bank's first-quarter loss widened from accounting charges and rising bad debts in Ireland, but its shares rose more than 3% Friday as investors and analysts took comfort from improvements in the bank's core divisions.
Group operating profit, stripping out tax, accounting charges and restructuring costs, was GBP1.05 billion in the three months--better than some analysts' expectations--compared with GBP882 million in the first three months of 2010. The 83% state-owned bank took GBP1.95 billion in impairments, down 27% from GBP2.68 billion and including GBP1.29 billion from its Ireland loan books. RBS still hasn't said what it might have to pay over PPI.
HSBC, reported May 9: The bank's costs soared in the first quarter from a series of one-off charges that included a $440 million provision over mis-sold payment protection insurance. However, net profit rose 58% as it took hefty tax credits in its U.S. business. Analysts said they were disappointed with flat revenue and a miss on pretax profit figures, and that they would probably revise their full-year estimates downward.
HSBC's cost-income ratio, or expenses relative to income, hit 60.9%, well above its target of around 52%. New CEO Gulliver on Wednesday will outline the bank's priorities and potential step-back from some countries and businesses. Europe and North America are seen as the biggest candidates for restructuring.
-By Margot Patrick, Dow Jones Newswires; +44 (0)20 7842 9451; margot.patrick@dowjones.com
(END) Dow Jones Newswires
May 09, 2011 07:58 ET (11:58 GMT)
Recent BCS News
- Barclays appoints Bradley Rogoff as Global Head of Research • Business Wire • 09/30/2024 02:29:00 PM
- Barclays Bank PLC Updates Announcement of 5 Cash Tender Offers and Consent Solicitations • Business Wire • 09/25/2024 11:59:00 PM
- Barclays Appoints Two New Senior Leaders in Investment Banking for Canada • Business Wire • 09/20/2024 09:12:00 PM
- Barclays Appoints Three Senior Leaders in its Industrials Investment Banking Team • Business Wire • 09/18/2024 05:48:00 PM
- Barclays Appoints Abhishek Singhal as a Managing Director Within Technology Investment Banking • Business Wire • 09/17/2024 09:14:00 PM
- Microsoft Boosts Share Buyback, Raises Dividends by 10%, Intel Secures Chip Deal with Amazon • IH Market News • 09/17/2024 10:40:35 AM
- Barclays appoints Rob Patterson as Head of Data & Information Platforms Coverage within Technology Investment Banking • Business Wire • 09/16/2024 09:26:00 PM
- Form CERT - Certification by an exchange approving securities for listing • Edgar (US Regulatory) • 09/13/2024 07:01:10 PM
- Barclays Bank PLC Amends Purchase Price of Certain Cash Tender Offers and Consent Solicitations • Business Wire • 09/10/2024 09:46:00 PM
- Form 424B2 - Prospectus [Rule 424(b)(2)] • Edgar (US Regulatory) • 09/05/2024 04:41:43 PM
- Form FWP - Filing under Securities Act Rules 163/433 of free writing prospectuses • Edgar (US Regulatory) • 09/04/2024 10:56:25 AM
- Form FWP - Filing under Securities Act Rules 163/433 of free writing prospectuses • Edgar (US Regulatory) • 09/04/2024 10:51:49 AM
- Form FWP - Filing under Securities Act Rules 163/433 of free writing prospectuses • Edgar (US Regulatory) • 09/04/2024 10:48:57 AM
- Barclays Appoints Cathy Leonhardt as Global Head of Retail Within Investment Banking • Business Wire • 09/03/2024 04:30:00 PM
- Form 424B2 - Prospectus [Rule 424(b)(2)] • Edgar (US Regulatory) • 09/03/2024 11:37:42 AM
- Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16] • Edgar (US Regulatory) • 09/03/2024 11:19:00 AM
- Barclays Appoints Martin Douglass as Head of Financial Sponsors M&A • Business Wire • 08/27/2024 04:16:00 PM
- Google Forced to Modify Play Store, Apple Innovates, Victoria’s Secret Hires CEO, Mars Buys Kellanova • IH Market News • 08/15/2024 10:05:46 AM
- Google Mandated to Modify Play Store, Apple Innovates, Victoria’s Secret Hires CEO, Mars Buys Kellanova • IH Market News • 08/15/2024 10:05:46 AM
- Barclays hires Stephen Stewart as Head of M&A Execution for Canada • Business Wire • 08/09/2024 01:00:00 PM
- TSMC July Revenue Surges 45%, Nasdaq Accelerates Penny Stock Delistings, Moody’s Downgrades Intel to BAA1, and More • IH Market News • 08/09/2024 09:44:44 AM
- Barclays Bank PLC Updates Announcement of 6 Cash Tender Offers and Consent Solicitations • Business Wire • 07/31/2024 11:52:00 PM
- Barclays Appoints Jonathon Traer-Clark as Head of Americas for Global Transaction Banking • Business Wire • 07/30/2024 02:51:00 PM
- Alphabet Unveils AlphaProof and AlphaGeometry 2; OpenAI Tests SearchGPT; Apple Loses Market Share in China • IH Market News • 07/26/2024 10:07:41 AM
Transforming Alzheimer's Treatment: Innovative Combinations to Boost Cognition • PFE • Oct 2, 2024 9:00 AM
Unitronix Corp Unveils Cryptocurrency Investment Portfolio Strategy • UTRX • Oct 2, 2024 8:40 AM
Integrated Ventures, Inc Reports Total 2024 Revenues Of $5,863,935 vs $3,862,849 for 2023. • INTV • Oct 1, 2024 9:00 AM
Nightfood Signs Letter of Intent to Acquire Los Angeles Cooking School, Integrating Automation and Robotics with World-Class Culinary Training • NGTF • Oct 1, 2024 8:30 AM
ZenaTech, Inc. (NASDAQ: ZENA) To Commence Trading Today • COOP • Oct 1, 2024 7:00 AM
Element79 Gold Corp secures loi for launching tailings reprocessing business in Arequipa, Peru • ELMGF • Oct 1, 2024 6:38 AM