London, UK (BBN)-Europe’s biggest bank has posted a 1.2 per cent decline in net profit to $13.52bn (£6.78bn) for the 12 months to December compared to a year earlier, citing a slowdown in China, among other issues.
Pre-tax profit was up 1 per cent compared to a year earlier to $18.87bn, the bank said, below market expectations, reports BBC.
The lender said 2015 had delivered a “difficult market environment”.
However, group chairman Douglas Flint said the bank’s financial performance was “broadly satisfactory”.
“2015 was marked by some seismic shifts in global economic conditions, most notably the continuation of a sharp decline in commodity and oil prices, in part attributable to growing concerns over China’s slowing economic growth,” he said
HSBC’s Hong Kong-listed shares fell on the profit report and were down 0.5 per cent in afternoon trade.
The lender’s group chief executive also noted the bank had seen a tough year in 2015, but that it was continuing to focus on delivering cost cutting measures announced in June last year.
“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,” said group chief executive Stuart Gulliver.
Asia accounts for the majority of the lender’s profit, however, its headquarters have been in the UK since 1993.
Earlier this month, after a months-long review amid concerns about stricter UK regulations, the lender said it would keep its headquarters in London.
The most likely alternative for any move would have been Hong Kong.
HSBC said it had decided unanimously against the move and that London offered “the best outcome” for its shareholders and customers.
HSBC, which launched its review in April, is understood to have paid about £30m to advisors to help it reach the decision, which was was seen as a vote of confidence for the UK.
However, some analysts said the decision to stay in London was not a good one because it meant HSBC would face tighter regulations together with the cost of the UK bank levy.
London-listed shares in HSBC have fallen 16 per cent in the year-to-date and more than 25 per cent over the last 12 months.
Last year, the bank announced thousands of job cuts, along with asset sales, as part of cost-cutting measures to improve returns to shareholders.
The lender has a global network of more than 6,000 offices in 72 countries and territories and serves some 48 million customers, according to its website.
In 2015, HSBC marked its 150th anniversary.