HSBC’s 2015 profit slips to $13.5 B on fourth-quarter loss

The Bernstein analysts said the 13% fall in underlying income was more than they had expected. Officials are forecasting growth of between 6.5 and 7 per cent this year.

Large U.S. banks such as JPMorgan Chase and Morgan Stanley were under fire for similar issues throughout China in 2013 and 2014, to determine if they violated the Foreign Corrupt Practices Act among other issues. Not all the disposals have gone to plan, though. “While it has been a time of operational challenge with fast moving market conditions, we are delivering our strategic growth plan and have evolved our management and business structure at the start of 2016 to support further growth”.

The bank, which is reining in costs as a result of its higher regulatory burden, said in its annual report Chief Executive Stuart Gulliver’s total pay had fallen to 7.34 million pounds ($10.43 million) from 7.62 million a year earlier.

Europe’s biggest bank, which just over a week ago decided not to move its headquarters to Hong Kong, proposed to hike its dividend to $0.51 per ordinary share against $0.50 a year earlier. It said dividend growth depends on the group’s overall profitability in the long term.

However, full-year profit attributable to ordinary shareholders declined 1 percent to $13.52 billion from $13.69 billion in the prior year.

Chairman Douglas Flint and CEO Gulliver are both expected to step down within the next two years and HSBC has said the next chairman could be an external candidate.

HSBC stated that it was too early to say how the investigation would be resolved, or when, but said the impact “could be significant”.

HSBC also warned that a USA monitor who is assessing its anti-money laundering and sanctions compliance following its US$1.9bn fine for breaching sanctions in 2012 was not happy with its progress. The monitor withheld a crucial certification around HSBC’s remedial measures, “pending further review and discussion with HSBC”.

Julie Steinberg in Hong Kong contributed to this article.

The results fuel investors’ worries that slower growth in Asia would kick off a rise in bad loans and lower revenue for HSBC and rivals such as Standard Chartered PLC.

HSBC to axe up to 25,000 jobs globally in savings drive.

Global banking giant HSBC announced Monday its results for 2015 which fell below analysts’ expectations after what it called “seismic shifts” in the world economy. Excluding one-time items, such as a US$773 million charge on movements in the fair value of its debt, the lender had a pretax profit of US$1.9 billion.

“With respect to each of these ongoing matters, HSBC is cooperating with the relevant authorities in a manner consistent with relevant laws”, it added. HSBC’s global oil and gas exposure was $29 billion at December 31.

“We’re committed to take out a very large chunk of our cost base and we’ll do that”, Gulliver said. It said these rules “are more stringent than the rules in force in the EU, US, and Asia-Pacific, making it challenging for United Kingdom banks to attract talent with transferable skills or from other industries”.