Financial News: HSBC Invest Bank Aided By Asia, North America

2nd Aug 2010 14:08

By Matt Turner Of FINANCIAL NEWS HSBC's (HBC) investment bank delivered its second highest half-year performance as the U.K. bank relied on its Asian and North American units to maintain its strong growth. Pretax profits for the first half of 2010 were $5.6 billion in the global banking and markets business, down 13% against the first half of last year but still the second-best performance of any half-year period. HSBC's strong results relied more on its Asian and North American operations than in previous periods. Europe was responsible for 37% of profit before tax, a fall from 46% in the first half of 2009 and 39% in the second half of the year. In comparison, the contribution of the bank's North America operation rose to 18% from 8% in first half of 2009, and 6% in second half; while the contribution from the Asia-Pacific division ex-Hong Kong rose to 23% from 20% in the first half of last year, although down from 26% in second half. It is also one of the lowest contributions of the European business for five years. In the intervening period, the figure has hovered around 40%, although the European unit recorded losses of $995 million in the second half of 2008, while the global business recorded a profit. The bank meanwhile added that it was continuing to build out its equities platform across advisory, equity capital markets, research and distribution in Hong Kong, mainland China, India, the Middle East, Brazil and Mexico. In a statement to the stock exchange, HSBC said that global banking and markets was an excellent example of the bank's focus on international business. It said: "Our global network allows us to service customers with cross-border trading or financing needs anywhere in the world, by accessing the expertise in our major dealing rooms in centres like London, Paris, New York and Hong Kong." Global markets, which include credit, rates, foreign exchange, equities, securities services and asset and structured finance, recorded revenues of $5.5bn, down against $6bn in the equivalent period a year earlier, but up against $4.4bn in the second half of last year. Income from the equities business was up more than 50% against the first half of 2009, generating $479 million. Region-wide, HSBC said that credit and foreign exchange were down marginally against a year previous. Income from the rates business also fell, as "higher economic uncertainty and subdued market conditions resulted in lower demand." The global banking business remained relatively steady against the first and second half of 2009, with financing and equity capital markets down against the highs recorded last year. Payments and cash management, and other transaction services, were broadly in line with the first half of 2009. Web site: www.efinancialnews.com Order free Annual Report for HSBC Holdings plc Visit http://djnweurope.ar.wilink.com/?ticker=GB0005405286 or call +44 (0)208 391 6028 (END) Dow Jones Newswires August 02, 2010 09:08 ET (13:08 GMT)