HSBC on Monday reported a 65% year-over-year plunge in pre-tax profits for the first six months of 2020 as it set aside more funds for potential loan losses that could come as a result of the coronavirus pandemic.
The bank, Europe’s largest by assets, reported profit before tax of $4.32 billion in the first half of this year — down from $12.41 billion that was reported a year ago and missing the estimated $5.69 billion that HSBC had compiled from analysts.
The bank’s reported revenue fell by 9% to $26.7 billion during the same period. That’s slightly above analysts’ expectations of $26.41 billion, according to estimates compiled by HSBC.
HSBC shares in Hong Kong tumbled by more than 4% when trading resumed after the lunch break.
Chief Executive Noel Quinn said the bank was “impacted by the Covid-19 pandemic, falling interest rates, increased geopolitical risk and heightened levels of market volatility.”
“The first six months of 2020 have been some of the most challenging in living memory. Due to the Covid-19 pandemic, much of the global economy slowed significantly and some sectors drew to a near total halt,” he said in a statement accompanying the earnings release.
