HSBC annual pretax profit more than doubles, brings forward key target

A man wearing a protective mask walks past a logo of HSBC at its headquarters, amid the coronavirus disease (COVID-19) outbreak in Kuala Lumpur, Malaysia September 9, 2020. REUTERS/Lim Huey Teng/File Photo GLOBAL BUSINESS WEEK AHEAD

SINGAPORE, Feb 22 (Reuters) – HSBC Holdings (HSBA.L) on Tuesday reported annual pre-tax profit more than doubled as the Asia-focused bank reversed hefty credit charges booked previously, saying it now expects to meet a key profitability goal a year ahead of schedule.

The lender reported pretax profit came in at $18.9 billion last year, up from the previous year’s $8.8 billion but just below the $19.1 billion average of 17 analyst estimates compiled by HSBC itself.

The bank said that if central bank interest rates rise worldwide as expected, the resulting improvement in its lending margins would mean it hits its goal of a double-digit return on equity in 2023, a year earlier than expected.

Like global peers, HSBC, one of Europe’s largest banks, is taking advantage of lower-than-expected impairment charges as its borrowers reap the benefit of government support packages in markets hit by the coronavirus pandemic, while a recovery in economies is also supporting firms.

HSBC said it would buy back up to $1 billion of its own shares, after the conclusion of an existing $2 billion buyback programme.

Reporting by Anshuman Daga in Singapore and Lawrence White in London; Editing by Kenneth Maxwell

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