HSBC saw its underlying profits dip by 7 per cent in 2015, which was caused by higher costs and credit charges.
In the bank’s full year results, adjusted profits before tax fell to $20.4bn (£14.4bn) in 2015, compared with $22bn (£15.5bn) in 2014.
Reported profits, however, were up 1 per cent to $18.9bn (£13.4bn).
This follows a 32 per cent increase in the bank’s profits in the third quarter of last year, which was related to a fall in fines and legal settlements.
Meanwhile, HSBC’s operating expenses were up 5 per cent to $36.2bn (£22.7bn), caused by wage inflation, business growth and investment in regulatory programmes and compliance.
Stuart Gulliver, group chief executive, said: “Targeted investment, prudent lending and our diversified, universal banking business model helped us achieve revenue growth in a difficult market environment, whilst also reducing risk-weighted assets.
“Strict cost management slowed cost growth and our cautious approach to credit helped keep loan impairment charges low.”
Douglas Flint, group chairman, said 2015 was marked by some seismic shifts in global economic conditions.
“Against that backdrop, the group’s financial performance in 2015 was broadly satisfactory,” he said.
“Against that backdrop, the group’s financial performance in 2015 was broadly satisfactory.” Douglas FlintMr Flint highlighted that across all businesses, there has been a heightened emphasis on customer focus, which he said permeated recruitment, training, product design and incentives.
“This is essential to the restoration of trust,” he added, pointing to the investigation into the root causes of the misconduct issues that have “bedevilled” the industry in recent years.
2016 sees the introduction of the new Senior Managers’ Regime in the UK, which aims to reinforce individual responsibility and accountability.
Last week, the board decided unanimously to remain headquartered in the UK, following 10 months of analysis and assessment of geopolitical, economic, regulatory and financial factors.
Earlier this year, HSBC revealed plans to offer standalone investment advice.
katherine.denham@ft.com
