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The profits increase came on the back of higher banking net interest income and growth in fee and other income, the lender said in its earnings report.
“HSBC is becoming the stronger bank we set out to build. We are executing our strategic priorities with pace, precision and discipline,” CEO Georges Elhedery said in a statement.
Profit attributable to shareholders rose around 27% to $14.6 billion (€12.61bn) in the six months to June, from $11.5 billion (€9.93bn) a year earlier.
Pre-tax profit increased 23% to $19.5 billion (€16.84bn).
Pre-tax profit surged 60% year on year to $10.1 billion (€8.72bn) in the April-June quarter, supported by higher banking net interest income and strong growth in wealth management and fee income.
In a sign of confidence, HSBC announced a share buy-back of up to $1 billion (€0.86bn) after its board approved a second interim dividend of US$0.10 (€0.09) per share.
The move comes after the bank paused buy-backs for three quarters as it rebuilt capital following the privatisation of Hang Seng Bank.
However, the strong results were partly offset by expected credit losses of $2.4 billion (€2.07bn), $400 million (€345.20m) higher than in the first half of 2025.
The bank said it incurred $400 million (€345.20m) of losses linked to a fraud involving a British financial sponsor and $200 million (€172.60m) relating to Hong Kong’s commercial property sector.
It also raised its cost savings target to $2 billion (€1.73bn) from $1.5 billion (€1.29bn), reflecting progress in its restructuring programme.
The bank said it would continue to simplify and modernise its operating model through a multi-year AI-led transformation programme aimed at streamlining workflows.
HSBC has announced 15 business or market exits since last year, Elhedery added.
The lender has in recent weeks agreed several disposals as part of a global restructuring to sharpen its focus on core markets.
Those plans include selling a $25.3 billion (€21.85bn) Australian home loan portfolio to Blackstone and a $2.1 billion (€1.81bn) Singapore insurance business to Germany’s Allianz.
It also announced on Sunday the sale of its retail banking business in Egypt.
The disposals are expected to free up capital for investment in the bank’s strategic growth areas, HSBC said.
Since taking office in 2024, Elhedery has accelerated HSBC’s restructuring, including winding down much of its investment banking operations in the United States, Britain and Europe.
“HSBC’s second-quarter results follow the same pattern as that of the other UK, US and EU-listed megabanks, with profits that are higher than expected, an increase to full-year guidance and bumper cash returns from dividends and a share buyback,” AJ Bell investment director Russ Mould said in a note sent to Euronews.
Additional sources • AFP