HSBC Optimistic About Asia

HSBC has expressed confidence in Asia, saying it is cautiously upbeat over the region’s growth outlook. Even when there are some signs of slowdown, HSBC remains firm that Asia is still the place to be.

The optimistic outlook of HSBC is a positive sign for Australian banks like ANZ and Commonwealth Bank as they expand their business in Asia. The move of these Aussie banks is to ensure growth outside the Australian market, which has been suffering from a sluggish lending market.

And while China has suffered a slowdown in its economy, posting only an eight percent growth in 2012, Australia has much at stake. Its mining industry alone is dependent on China.

According to HSBC chief executive Stuart Gulliver, the Asian region has always been a powerhouse.  He also not worried with China’s slowdown, saying it would have a soft landing.

Last night, one of the world’s largest banks posted an 11-percent increase in its pre-tax profit for the first half of the year with US$12.7 billion. HSBC’s underlying profits, however, decrease three percent to US$10.6 billion.

According to Gulliver, the decrease is due to the US$2.1 billion provisions which stemmed from some regulatory issues in the UK and the US.

This included the US$700 million to cover US fines, which was charged from the bank’s failure to stop money-laundering activities in the bank.

According to statistics, HSBC’s earnings from the Asian region make up two-thirds of company’s total profits before tax.