HSBC saw pre-tax profits plunge by more than a third to $8.8 billion last year, according to its latest financial results.

The British bank said that the loss could be attributed to higher expected credit losses, other credit impairment charges, and a lower revenue, which was partly offset by a fall in operating expenses.

Operating expenses were down 19 per cent to $34.4bn, which the bank said was mainly due to the non-recurrence of a $7.3 billion impairment of goodwill.

HSBC said that a revenue decline of 10 per cent to $50.4 billion was primarily due to the progressive impact of lower interest rates.

HSBC is not the only British bank to have suffered significant losses in 2020.

Last week NatWest reported operating loss of £351 million after being hit hard by the coronavirus pandemic.

“In 2020, our people delivered an exceptional level of support for our customers in very tough circumstances, while our strong balance sheet and liquidity gave reassurance to those who rely on us,” said Noel Quinn, group chief executive. “We achieved this while delivering a solid financial performance in the context of the pandemic – particularly in Asia – and laying firm foundations for our future growth.

He added: “I am proud of everything our people achieved and grateful for the loyalty of our customers during a very turbulent year. The growth plans we are announcing today aim to establish HSBC as a dynamic, efficient and agile global bank with a digital-first mindset, capable of providing a world-leading service to our customers and strong returns for our investors. We intend to deliver them at pace.”

Growth in Asia

The bank said that its future growth plans aim to "play to its strengths," particularly in Asia, and that it intends to invest in capture trade and capital flows into and across the region.

In 2020, the board worked closely with the management team on plans to accelerate investment in key areas of growth, including its Asian franchise, wealth business and new technology.

Group chairman Mark E Tucker said that while adjusted profit before tax was $12.1 billion, down by 45 per cent, global banking and markets performed particularly well, with Asia being “by far” the most profitable region.

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