Georges Elhedery – CEO of HSBC

Alongside the results, HSBC unveiled plans for a new share buyback programme of up to $3 billion (c. £2.2bn), which it aims to complete before announcing its 2025 interim results. This buyback was larger than some market analysts had anticipated.

Profit before tax for the quarter stood at $9.5bn (c. 7.1bn), a 25% decrease compared to the same period last year. Revenue also fell by 15% year-on-year to $17.6bn (c. £13.1bn). These declines were largely attributed to the comparison with Q1 2024, which included substantial gains from the sale of HSBC’s Canadian banking business and its operations in Argentina.

Excluding the impact of these disposals, the bank indicated underlying revenue growth. This was driven by positive performance in its wealth management division, particularly attracting customers in Hong Kong, and strength within its debt and equity markets arm, which benefited from market volatility. Robust performance was also noted in its corporate and institutional banking segment.

Reflecting heightened economic uncertainty, geopolitical tensions, and concerns over higher trade tariffs, HSBC increased its allowance for expected credit losses (ECL) by $200m (c. £150m) to $900m (c. £671m) for the quarter. The bank explicitly warned that escalating trade tensions could negatively impact global growth, investment, consumer spending, and potentially fuel inflation, leading to lower revenues and increased bad debts in the future.

Chief executive Georges Elhedery commented on the “strong results” demonstrating “momentum in our earnings” and “confidence in our ability to deliver our targets”.

The bank is undergoing restructuring, which it anticipates will yield $300m (c. £224m) in cost reductions this year, though it expects associated severance and upfront costs of $1.8bn (c. £1.3bn) spread across 2025 and 2026.

AJ Bell investment director Russ Mould said: “HSBC’s shares have already rebounded smartly from their post-Liberation Day lows of early April and a solid set of first-quarter results is helping them to extend their advance, thanks in part to a new $3 billion share buyback programme.

“Profits fell compared to the first three months of a year ago, but the absence of capital gains on asset disposals was the major reason why, and the underlying performance was solid enough, given the uncertainties created by President Trump’s tariff and trade strategies for what is essentially an Asia-focused bank that generates the bulk of its profits in China and Hong Kong.

“HSBC’s unchanged quarterly dividend of $0.10 equates to a cash distribution to shareholders of $1.77 billion, and the first quarter buyback of $2 billion supplements that. HSBC is now rolling out a $3 billion buyback for the second quarter and for the year as a whole analysts believe that the megabank’s total cash return to shareholders will reach £17.5 billion.

“This combination of dividends and buybacks equates to more than 12% of the bank’s stock market capitalisation, the highest figure among any of the Big Five FTSE 100 lenders. It is also one that may catch the eye of income seekers, given how it comfortably outpaces not just inflation but the returns available on cash and benchmark UK government gilts.”