Business

Lower bad loans give HSBC a big Q1 profit boost

HSBC reported net profit of $6.35 billion for the first three months of the year.
AFP/Getty Images/File
HSBC reported net profit of $6.35 billion for the first three months of the year.

LONDON — HSBC PLC, Europe’s biggest bank by market value, saw its profits more than double in the first quarter as it booked fewer bad loans than in the same period last year and reaped the benefits of recent restructuring measures.

The bank, which has a big presence in many parts of the world, including China, said Tuesday that its net profit rose to $6.35 billion in the first three months of the year from $2.58 billion in the same period of 2012.

Chief executive Stuart Gulliver said the bank has made progress in increasing revenue and reducing costs, cutting some 40,000 jobs out of a workforce of 300,000 since 2011. He also alluded to efforts­ made to embed changes in the corporate structure to prevent money laundering at the immense institution.

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‘‘We have achieved further progress on the journey we started in 2011 to make HSBC easier to manage and control,’’ he said in a statement. ‘‘The implementation of global standards will help ensure that we meet the commitments we made to the US and UK authorities as part of the settlement agreements reached at the end of last year.’’

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The changes came after
the group agreed to pay nearly $2 billion last year to settle a money-laundering case involving illicit drug money from Mexico.

Net interest income fell to $8.97 billion from $10.08 billion. However, it said that was made up by a rise in trading income and fewer bad loans and insurance claims, compared with last year.