HSBC reveals record-breaking profits

02 March 2005
The bank HSBC revealed profits in 2004 of £9.18 billion on Monday, the largest ever recorded by a UK-based bank.

It represents an annual profit increase of 35 per cent, taking its net income to a whopping $11.84 billion.

The bank has achieved growth in a number of key areas, such as consumer lending, credit cards and mortgages.

HSBC said card balances increased by 19 per cent on a year earlier, and residential mortgage balances were up by 20 per cent at £27.5 billion, leaving HSBC with a mortgage market share of 4.2 per cent - up from around three per cent.

Company chairman Sir John Bond said it had been "another good year" for the bank, adding: "The UK continued to enjoy high levels of employment and, while property prices softened, the market remained resilient.

"Indeed, buoyant domestic housing markets were a significant factor in most economies where they contributed to continued economic activity by bolstering consumer confidence and releasing equity to fund spending growth."

However, the record-breaking profits did not prevent shares in HSBC from falling nearly three per cent to 868 pence yesterday.

Craig Rippe, fund manager at Canada Life, said the market was not convinced by HSBC's exemplary profit margin.

"They have met their numbers, but that has come from associates and low bad debts," Mr Rippe told the Yorkshire Post.

"The shares are down because HSBC are relatively expensive versus other UK banks and they need to come out with good growth to justify that."

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