A switch from the expected provisions for losses last year, booked when the pandemic struck, helped propel the banking group's profit results.

HSBC today reported that after-tax profit for the third quarter of 2021 surged to $4.2 billion from $2.2 billion due to a release of expected credit losses and other impairment charges as the pandemic conditions eased.

All regions earned a profit, with Asia contributing $3.3 billion to the pre-tax reported profit; the UK reported a pre-tax profit rise of $1.0 billion to 41.5 billion, the Hong Kong/UK-listed bank said in a statement. 

The bank logged a net release of $700 million in Q3, against an expected charge last year of $800 million, helped by stability in economic conditions and better-than-expected credit performance, it said. 

Within the wealth and personal banking arm, HSBC logged net operating income of $16.8 billion in the nine months to 30 September, down from $17.264 billion. For the quarter, the figure was $5.418 billion, down from $5.57 billion. Within the wealth side, private banking revenue was $442 million in Q3, up from $424 million.

“The revenue outlook is becoming more positive, with fee growth across many of our businesses and a stabilisation of net interest income, which we expect to begin to increase in the coming quarters from lending growth and earlier than anticipated policy rate rises,” the bank said.

The group logged a Common Equity Tier 1 capital ratio of 15.9 per cent, rising 30 basis points from the second quarter of this year, as risk-weighted assets fell.