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Economy

Exceeding expectations, CEO Noel Quinn retires

The HSBC Holding logo is displayed on a smartphone with HSBC in the background in this illustration taken in Brussels, Belgium, on February 20, 2024.

Jonathan Ra | norphoto | Getty Images

HSBC beat market expectations in its first-quarter earnings report on Tuesday, announcing the shock resignation of group CEO Noel Quinn.

Revenue was $20.8 billion, up 3% from the same period last year and compared to LSEG's average forecast of about $16.94 billion.

Pre-tax profits from January to March were $12.65 billion, down about 2% from a year ago when pre-tax profits were $12.89 billion. However, this figure exceeded the $12.61 billion estimate in analyst forecasts compiled by the bank.

Profit after tax income fell to $10.84 billion – less than the $11.03 billion seen in the first quarter of 2023.

HSBC, Europe's largest bank by assets, agreed to pay a first interim dividend of 10 cents per share, as well as a special dividend of 21 cents per share, after completing the sale of its banking business in Canada.

The company also announced the retirement of Quinn, who has been in the position for nearly five years.

Group Chairman, Mark Mark, said: “The Board would like to pay tribute to Noel’s leadership of the company. Noel has had a long and distinguished career spanning 37 years at the Bank, and we are very grateful for his significant contribution to the Group over many years.” Tucker.

“During his tenure, HSBC achieved record profits and the strongest returns in more than a decade,” said Eileen Taylor, Group Secretary and Chief Governance Officer at HSBC.

Quinn will remain as Group CEO while the bank begins the search for his successor. HSBC said it had agreed to remain available until the end of the 12-month notice period – which expires on April 30, 2025 – to support the transition.

Below are other highlights from the bank’s first quarter financial report card:

Net interest marginThe lending profitability rate decreased to 1.63% compared to 1.69% a year ago.
Tier 1 common stock ratio – which measures the bank's capital relative to its assets – amounted to 15.2%, compared to 14.8% in the fourth quarter of 2023.
Basic earnings per share It came in at $0.54, slightly higher than $0.52 in the same period last year.

HSBC also confirmed its 2024 forecast, saying it was unchanged from guidance in February.

The bank continues to target a return on average tangible equity in the “mid-20s” for 2024, with net bank interest income reaching at least $41 billion, taking into account global interest rate conditions.

HSBC said the CET1 capital ratio is expected to be within the medium-term target range of 14% to 14.5%, while the dividend payout ratio is targeted at 50% for 2024, excluding significant material items and related impacts.

Correction: This story has been updated to accurately reflect that HSBC's 2024 first-quarter revenue was 3% higher than a year ago. This number has been skewed due to an editing error.