HSBC beats estimates and announces buyback as CEO retires unexpectedly

Group Chief Executive of  HSBC, Noel Quinn, during the panel on Mainland China/Greater Bay Area/Hong Kong: New dimensions at the Global Hong Kong Global Financial Leaders Investment Summit on November 7, 2023 in Hong Kong, China. The Hong Kong Global Financial Leaders Investment Summit organised by the city's central bank the Hong Kong Monetary Authority is held at the Four Seasons hotel with the theme Living with Complexity, with Financials Leaders attending the event.  (Photo by Vernon Yuen/NurPhoto via Getty Images)
HSBC's CEO Noel Quinn is to step down unexpectedly after five years at the helm. (NurPhoto via Getty Images)

HSBC's (HSBA.L) results for the first quarter of 2024 came with a surprise as its CEO Noel Quinn announced early retirement after a five-year stint leading the bank. HSBC has begun the hunt for his replacement.

The news came as it reported a pretax profit of $12.7bn (£10.1bn) — above analysts' forecasts of $12.6bn and slightly less than the $12.9bn for the same quarter a year ago. The bank has grappled with rising costs across Asia, high inflation and what it called "investment in technology".

Profit before tax included a $4.8bn gain on the sale of its Canada business and a $1.1bn impairment relating to the planned sale of its Argentina business.

“I’m pleased with our start to 2024. We completed the sale of our Canada business and agreed the sale of our Argentina business, both of which allow us to focus on markets with higher value international opportunities," said Quinn in a statement. "Our good profit performance of $12.7bn in the first quarter has enabled us to continue the trend of rewarding our shareholders."

HSBC announced it will buyback $3bn worth of shares, bringing the total buybacks for shareholders to $8.8bn. It will also pay out a $0.10 per share dividend.

Read more: What are share repurchases?

HSBC 2024 guidance remains unchanged, the bank added.

The results tell a more positive story than they did for the three months to the end of 2023, when profits fell 80% from $5bn in the same period a year earlier to $1bn.

In February, the bank revealed a shock $3bn charge on its stake in a Chinese bank amid mounting bad loans in the country. The impairment charge on its stake in China's Bank of Communications (BoCom) was the largest yet by an overseas lender.

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