HSBC profits fell 49 percent in the first three months of the year, on a “substantially worsened outlook for the world economies” that saw profit after tax tumble to $2.5 billion from $4.9 billion in Q1 2019.
The company is “pausing” a planned 35,000 redundancies that it announced in February, meanwhile, with CEO Noel Quinn saying: “I take the well-being of our people extremely seriously [we have paused the redundancies] to reduce the uncertainty they are facing at this difficult time.
The news came as HSBC continued to overhaul its digital and IT processes, with an investor report this morning showing that many transformative investments were bearing fruit as the bank digitalised.
(HSBC earlier pledged — as Computer Business Review reported — to slash legacy software costs $900 million by 2022 under its restructuring plan, and trim existing technology costs by up to $1.2 billion).
CEO Quinn added: “We continue to press forward with the other areas of our transformation with the aim of delivering a stronger and leaner business that is better equipped to help our customers prosper in the recovery still to come.”
HSBC Digital Transformation
An investor presentation suggests that many digital transformation efforts are beginning to bear fruit. “Enhanced support” for customers through digital channels alone saw loans and advances increase by a chunky $64 billion versus Q1 2019, as customers moved to shore up liquidity.
The company is also continuing to combine its the wholesale banking middle and back office, and launched a new digital platform globally across its Global Private Banking (GPB) segment, along with a new digital advisory offering. On the retail banking side, the quarter saw it enable Digital Identification and Verification for UK Current Accounts, and the bank said it is “are working with our various regulators to further enable digital sales”.
Across commercial banking, mobile downloads of the company’s HSBCnet application rose 32 percent during Q1 alone.