HSBC’s pre-tax profit rises 32% to $9.6 billion in third quarter
Key Facts
HSBC raised its pre-tax profit in the third quarter of 2026 by 32% to $9.6 billion, up $2.3 billion from the same period in 2025, according to its results statement issued on October 27. Profit after tax reached $7.6 billion, up 38% year on year. The bank said revenue growth, particularly banking net interest income, and lower expected credit losses supported the result. But the pre-tax increase also benefited from a favorable net effect of $1.4 billion from notable items. This was mainly due to the non-recurrence of legal provisions of the same amount recorded in the third quarter of 2025.
The group’s revenue was $18.6 billion, up $0.8 billion compared with the third quarter of 2025. Excluding notable items and on a constant-currency basis, revenue increased by the same amount to $18.7 billion, marking 5% year-on-year growth, according to HSBC’s preliminary reading of the results. Over the first nine months of the year, revenue rose 9% to $56.4 billion. It reached $56.8 billion excluding notable items and on a constant-currency basis, up $2.8 billion from the same period in 2025. These figures show that business growth exceeded the effect of comparative items in the quarter, while the reported result remained affected by that exceptional impact.
Net interest income reached $9.3 billion, up $0.5 billion, or 6%, compared with the corresponding period. Banking net interest income increased $0.6 billion to $11.7 billion. Fee income and other revenue also increased in the wholesale transaction banking, debt and equity markets businesses within the corporate and institutional banking segment. In wealth businesses, investment distribution and private banking income rose alongside client activity, the bank said. However, fee income and other revenue in the wealth and international personal banking segment fell 2% on a constant-currency basis to $1.904 billion, pointing to uneven performance across the components of the business.
On flows, HSBC attracted $41 billion in net new money in the third quarter, compared with $25 billion in the second quarter and $12 billion in the third quarter of 2025. Net new money totaled $105 billion in the first nine months, of which $95 billion was recorded in Asia. Wealth balances rose 3% to $1.6 trillion at September 30 compared with the end of 2025. Chief Executive Georges Elhedery said the bank’s performance reflected the execution of its strategic priorities. He added: "As we simplify HSBC, we are creating greater capacity to invest, grow and deliver strong returns for our shareholders."
Improved profit was reflected in returns, with annualized return on average tangible equity at 17.7% in the third quarter, compared with 12.3% in the corresponding period a year earlier. The measure rose to 18.2% excluding notable items. Meanwhile, the CET1 capital ratio was about 13.9% at September 30, down 0.2 percentage points from June 30. The board approved a third interim dividend of $0.10 per share. The bank also announced its intention to launch an additional share buyback of up to $1 billion, which it expects to complete by the announcement of its 2026 annual results.
The new buyback follows HSBC’s completion on September 28 of a previous $1 billion program announced alongside its first-half results. On guidance, the bank said it expects banking net interest income of at least $46 billion in 2026. It also targets return on average tangible equity of 17% or higher in each of 2026, 2027 and 2028, excluding notable items. The bank expects revenue growth to reach 5% in 2028 compared with 2027, on a constant-currency basis and excluding notable items. The 2026 annual results are scheduled to be announced on February 23, 2027.