Tuesday 04 August 2026 7:04 am
HSBC released its half-year update on Tuesday.
HSBC has resumed its share buyback programme after profit soared past expectations in the second quarter of 2026.
The FTSE 100 bank – whose market cap of £274bn makes it the London Stock Exchange’s most valuable company – posted $10.1bn (£7.5bn) in pre-tax profit for the last three months, surging past an internal forecast of £9.5bn. This was also up 60 per cent from the $6.3bn secured in the same period last year.
The profit haul came as revenue climbed 11 per cent to $37.7bn.
Net interest income climbed eight per cent to $18.2bn, as the bank re-invested lower-yielding hedges at current higher market interest rates, a strategy known as structural hedging. The group’s net interest margin – a key indicator of a bank’s profitability from lending – was up four basis points to 1.61 per cent.
Fee income, which is coveted by banks as a stable form of income due to its none-reliance on interest rates, increased nearly 10 per cent to $7.3bn.
This was driven by a bumper performance across wealth – a key area of focus for chief executive Georges Elhedery – which grew 20 per cent to $5.5bn.
HSBC restarts buybacks and ups cost-cutting target
HSBC said it would resume share buybacks with program of up to $1bn, set to be completed before the firm delivers its third quarter update.
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The group had previously hit pause on buybacks following its move to privatise Hang Seng Bank in October 2025. The blue-chip giant offered to pay HK$155 per share for a 36 per cent stake not already owned by the bank, which valued the holding at HK$106.1bn (£10.7bn).
In the second quarter update, Elhedery raised the bank’s cost-cutting target for the end of 2026 to $2bn from the original $1.5bn, which the group said was achieved at the beginning of this year.
It expects to achieve this within the original restructuring budget of $1.8bn.
Elhedery took the helm at the bank just over two years ago and quickly began his remake of the group’s operations.
A key part of chief executive Georges Elhedery’s restructure has included splitting the business into “eastern” and “western” markets, covering the Asia-pacific and the Middle East and the Americas and Europe, respectively.
Total headcount across the group has dropped to 206,161, down 2,559 since the year-end of 2025. City AM revealed last February the bank was set to axe a number of investment bankers on the same day allocated for bonus payouts.
Reports later confirmed that investment bankers at vice-president level and above received no bonus following termination.
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