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HSBC Posts Higher H1 Profit; CEO John Flint Steps Down

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Asia-focused lender HSBC Holdings Plc (HSBC,HSBA.L) reported Monday higher profit in its first half with strong revenues in most segments. Further, the company said it intends to initiate a share buy-back of up to $1 billion, which is expected to commence shortly.

Separately, HSBC said John Flint has stepped down as Group Chief Executive and as a Director by mutual agreement with the Board. Flint, who is leaving after almost 30 years with the company, was appointed as CEO in February 2018. He remains available to assist HSBC with the transition .

The company appointed Noel Quinn, currently Chief Executive, Global Commercial Banking, as interim Group Chief Executive and as a Director of HSBC Holdings.

The Board has initiated a process to find a new Group Chief Executive, and will consider internal and external candidates.

Mark Tucker, Group Chairman of HSBC, said, "In the increasingly complex and challenging global environment in which the Bank operates, the Board believes a change is needed to meet the challenges that we face and to capture the very significant opportunities before us."

Regarding 2020 financial targets, the company now said that based on the prevailing outlook for interest rates and revenue headwinds in certain segments, it does not expect to achieve 6 percent Return on average tangible equity or RoTE target in the US by 2020.

For the first half, HSBC's profit attributable to the ordinary shareholders of the parent company grew to $8.51 billion from last year's $7.17 billion. Earnings per share were $0.42, up from $0.36 a year ago.

Profit before tax went up 15.8 percent to $12.41 billion from prior year's $10.71 billion.

Adjusted profit before tax was $12.2 billion, compared to $11.72 billion last year.

Operating expenses declined 2.3 percent from last year, while adjusted operating expenses grew 3.5 percent.

Revenue for the period grew 7.6 percent to $29.37 billion from prior year's $27.29 billion. Adjusted revenue went up 8 percent to $28.50 billion.

In Asia, revenue increased 7 percent from the previous year.

In the first half, the company recorded strong revenue momentum in Retail Banking and Wealth Management as well as in Commercial Banking, with growth in all major products and all regions. Meanwhile, revenues in the Global Banking and Markets segment were lower.

In London, HSBC shares were trading at 642.80 pence, down 0.51 percent. In Hong Kong, the shares declined 1.5 percent to HK$61.25.

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