HSBC profits halved in first semester of 2009

As HSBC Holdings reported Monday, its first-half pretax profit halved to $5.02 billion, compared to the previous year’s value of $10.2 billion as it was hit by rising bad debts in the US, Europe and Asia.

However, it’s still higher than forecasted by Reuters 11 analysts poll $4.9 billion. 

HSBC was cautiously optimistic on economic outlooks but said the forecast still remained uncertain. As Chairman Stephen Green considers “It may be that we have passed, or are about to pass, the bottom of the cycle in the financial markets. Nontheless, the timing, shape and scale of any recovery in the wider economy remains highly uncertain” 

HSBC stocks rose by 4.4% to 632 pence, while Barclays shares which also posted half-year figures grew by 6.3%.

Loan impairments and other credit risk provisions increased to $13.93 billion in the first half, gaining $3.9 billion from the previous year.

Profits were underpinned by record investment banking earnings, with HSBC'S Global Banking and Markets profits jumping to $6.3 billion from $2.7 billion a year ago. But the personal financial services arm revealed a $1.25 billion loss as bad debts took their toll, against a $2.3 billion profit in 2008.

Defeats in the US made up $7.3 billion in the first half of this year, that is up from $4 billion a year ago but down from $8.8 billion in the previous six months.