The group, which reorganised its divisions into a simpler structure, said the wealth side of the business helped drive results and it expects to deliver double-digit income growth in "the medium term."

HSBC yesterday said that pre-tax profit on a constant currency basis for its wealth and personal banking arm rose 37.7 per cent in 2024 to $12.18 billion from a year before, with profit for the whole bank also rising to $32.3 billion from $29.9 billion. 

The WPB division logged net operating income of $27.3 billion in 2024, up from $25.9 billion; total operating costs rose to $15.2 billion from $14.35 billion. Expected credit losses in 2024 were $1.335 billion, widening from $935 million, Hong Kong/UK-listed HSBC said in a statement.

Looking ahead, HSBC said it expects double-digit percentage annual growth in fee and other income in its wealth business over the medium term.

“Our strong 2024 performance provides firm financial foundations upon which to build for the future, as we prioritise delivering sustainable strategic growth and the best outcomes for our customers. Since becoming CEO, I have focused on simplifying how we operate and injected energy and intent into the way we deliver our strategy. We are creating a simple, more agile, focused bank built on our core strengths,” Georges Elhedery, group CEO, said. 

The bank’s pre-tax profit result included a $1.0 billion net favourable effect from items in 2024 – selling off its banking arm in Canada, the effect of disposing Argentina businesses, and recycling foreign currency reserve losses and other reserves.

Wealth and personal banking and global banking and markets helped propel the bank’s results, offset to some degree by higher operating costs, HSBC said in a statement. 

HSBC’s Common Equity Tier 1 ratio – a standard international measure of a bank’s capital buffer – was 14.9 per cent, up slightly, mainly resulting from capital generation and a decline in risk-weighted assets. The bank’s board has approved a fourth interim dividend of $0.36 per share, producing a total of $0.87 per share. HSBC said it intends to initiate a share buyback of up to $2 billion, and expects to wrap that up by its first-quarter 2025 results announcement.

The bank said it is targeting a return on average tangible equity for 2025-27 to be in the “mid-teens” in percentage terms; it wants operating costs to rise by about 3 per cent in 2025 versus 2024. Cost targets include savings from a previously announced reorganisation. It plans to incur severance and up-front costs of $1.8 billion in 2025 and 2026.