HSBC Q1 Pretax Profit $9.4B, Below Estimates

HSBC Holdings reported a first-quarter pretax profit of $9.4 billion on Tuesday, a marginal decline from $9.5 billion a year earlier and below the $9.6 billion average analyst estimate. The London-based lender attributed the drop primarily to $1.3 billion in expected credit losses, including a $400 million charge tied to a UK fraud-related securitization exposure and a $300 million increase linked to a deteriorating global economic outlook amid the conflict in the Middle East.

Revenue rose 6 percent to $18.6 billion, bolstered by strong results in wealth management, Premier Banking and the bank's Hong Kong operations. Operating expenses also increased, contributing to the profit pressure. HSBC raised its outlook for 2026 expected credit loss charges to about 45 basis points of average gross loans, up from a prior estimate of around 40 basis points.

"We continued to make positive progress in creating a simple, more agile, growing HSBC," said Chief Executive Georges Elhedery. "Each of our four businesses contributed to firmwide revenue growth and each delivered an annualized return on tangible equity in excess of 17 percent, excluding notable items." He added that in periods of...