SOURCE / COMPANIES
HSBC likely to see booming business in China, as Meng comes back home: experts
Published: Oct 25, 2021 07:53 PM
File photo: HSBC Photo: VCG

File photo: HSBC Photo: VCG


On Monday, as Huawei CFO Meng Wanzhou resumed work in China, HSBC, which allegedly helped the US crack down on the Chinese tech giant, reported surging third-quarter profits in all of its markets, including the Chinese mainland and Hong Kong.

Experts said that the resolution of Meng's case had a positive influence on HSBC's business by dispelling investors' displeasure with the banking giant, whose shares are listed in the UK and Hong Kong. 

HSBC said that third-quarter pre-tax profits jumped 75.8 percent year-on-year to reach $5.4 billion, and all of its market regions were profitable. 

In the Chinese mainland, the bank achieved profits of $756 million, up from $551 million a year earlier. Profits in Hong Kong surged to $40 million from $3 million. 

Group Chief Executive Noel Quinn attributed the higher profits primarily to additional credit provision releases, while saying that the company's strategy remains "on track". 

"While we retain a cautious outlook on the external risk environment, we believe that the lows of recent quarters are behind us," he said in the financial report, adding that the bank would soon start a share buyback of up to $2 billion. 

The bank came under fire on China's social media after it was reported to have helped US prosecutors with charges against Huawei, which led to the arrest of Huawei CFO Meng Wanzhou. 

Meng returned to China from Canada on September 25 and went back to work at Huawei's Shenzhen headquarters on Monday. Online videos showed that she was warmly welcomed to her office by colleagues, who congratulated her for weathering more than 1,000 days of detention in Canada. 

Xi Junyang, a professor at the Shanghai University of Finance and Economics, said that Meng's return, which was read by the public as a victory for China against US attempts to stifle the nation's technology rise, likely will have a positive influence on HSBC's business performance.

"On the one hand, HSBC's mainland and Hong Kong customers who used to harbor negative feelings against HSBC because of the Meng Wanzhou case might find their anger had eased. On the other hand, third-party clients who were suspicious about HSBC's handling of client information had their doubts alleviated, after seeing that the Meng Wanzhou case has been resolved," Xi told the Global Times. 

However, although the Huawei case seemed to be a "black swan incident" for HSBC, the bank should take care to "protect its customers' interests with more sophisticated technologies and services, otherwise it might get involved in similar political disputes that would harm its business", Xi said. 

Global Times 


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