[Economics] HSBC profit falls 17%

[ddude_stnom]

HSBC blames 'challenging year' as profit falls 17%
Source: British Broadcasting Coorparation

HSBC has said 2014 was a "challenging year" after reporting a 17% drop in profit to $18.7bn (£12.2bn).

The bank blamed the negative effect of $2.4bn in fines and settlements and UK customer redress for the sharp fall.

The results follow allegations, which emerged earlier this month, that HSBC had helped people evade UK tax using hidden HSBC accounts in Geneva.

HSBC chief executive Stuart Gulliver saw his overall pay for the year fall to £7.6m from £8.03m in 2013.

HSBC's shares fell more than 5%, hitting their lowest level for two-and-a-half years, after it reported its fall in profit, which was larger than analysts had expected.

The drop in profitability was driven by $2.4bn in fines and customer compensation costs, largely connected to fines in connection with traders' attempted manipulation of foreign exchange rates and compensation for the mis-selling of payment protection insurance.

The bank has been streamlining its business in an attempt to boost earnings, and Mr Gulliver said it had now closed or sold 77 businesses and lost 50,000 jobs since he took the helm in 2011.

Fines and "redress" (in the main payments for the mis-selling of payment protection insurance) total £2.4bn. The bank has also raised significant concerns over Europe, saying that reform is "far less risky than going it alone".

The bank said restoration of trust in the industry "remains a significant challenge as further misdeeds are uncovered but it is a challenge we must meet successfully".

Investigation

The Financial Conduct Authority, HMRC, Swiss prosecutors and MPs on the Treasury Committee are looking into the allegations that HSBC helped people evade UK tax using hidden HSBC accounts in Geneva.

The former director of public prosecutions, Lord Ken Macdonald, has warned that HSBC has left itself open to criminal charges in the UK over the tax-dodging scandal.

[itsConnor_]

[lioneatszebra]

I don't get it... Is there a language barrier here? Lol.

[ddude_stnom]

You do laundry in a washing machine. This case laundry equals money laundering; linking it to the tax evasion scandal. (At least I believe this is what Connor is implying, lol.)