HSBC group has reported on Tuesday an increase in its profit by $1.5 billion, following its recent acquisition of the collapsing UK business of Silicon Valley Bank (SVB UK). The UK-based bank announced that its pretax profit reached $12.9 billion by the end of March, which is three times the amount of last year's profit, as a result of its purchase of SVB UK for £1. The profit includes a provisional increase of $1.5 billion on the acquisition of SVB UK, said HSBC. "We remain focused on continuing to improve our performance and maintaining tight cost discipline, but we also saw an opportunity to invest in SVB UK to accelerate our growth plans," said the bank's chief executive Noel Quinn. HSBC's plans to write off $2.1 billion following the sale of its business in France, which did not go into effect, to be reversed, while the $10 billion sale of its business in Canada is expected to be delayed. The bank's sales comes in light of its strategy to pull back from slow growing Western markets. HSBC also announced its first quarterly payout to shareholders since 2019, before the COVID pandemic and said it would buy back $2bn of its shares. HSBC has been facing pressures from its biggest shareholder Ping An, Chinese insurance giant, which called the bank to spin off its Asian operation to increase the amount investors make out of the business. "If you look at HSBC's share price for the past eight years, Ping An's investment hasn't been a particularly good one. A break-up may enhance the value of the bank for shareholders in Asia," said Kenny Wen, the head of investment at KGI Asia in Hong Kong. HSBC has urged its shareholders to vote against the proposal at its annual general meeting, which will be taking place in Birmingham on Friday. Download
