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Due to the economic rebound in major markets including the United Kingdom, HSBC increased the bankers’ bonus pool and announced a new shareholder dividend after its profit in the second quarter increased by more than four times.
The London-based bank said it had increased its banker bonus pool by US$900 million in the first half of this year in order to compensate its star employees, and by the same period in 2020 by US$600 million. The Covid-19 crisis.
The top bankers still have six months to increase the bonus pool before they are paid next spring. Last year, HSBC paid more than 1 million euros (854,000 pounds) in bonuses to 324 bankers, of which 8 bankers earned more than 5 million euros. A banker who asked not to be named received a bonus of 9 million to 10 million euros, roughly double the 4.2 million pounds paid to its chief executive Noel Quinn in 2020.
HSBC said that the increase in the bonus pool reflects its strong performance, as the three-month pre-tax profit for the three months ended June 30 increased from US$1 billion a year ago to US$5 billion When it set aside billions of pounds to pay for potential defaults Related to the epidemic.
The bank said that improved economic forecasts, especially in the UK, means it can release US$284 million In the same period of 2020, a loan loss reserve of US$3.8 billion was set aside to make up for potential bad debts.
“The UK economy rebounded strongly in the first half of this year,” Quinn said.
“It must be attributed to the vaccination program that supported the economic rebound in the UK. The UK government has done a good job in obtaining such a high vaccination coverage rate. So this is encouraging and we are optimistic about the situation in the UK economy in the second half of the year. “
However, HSBC said that uncertainty still exists, “because countries have different reaction speeds, government support measures have been relaxed, and new virus strains are testing the effectiveness of the vaccination plan.”
Despite the uncertainty, the bank confirmed that it will pay its investors a dividend of 7 cents per share, making it the latest British bank to take advantage of Covid’s relaxed shareholder dividend rules.
Bank of England Order the largest bank in the UK No cash bonuses are paid to senior employees, and dividends were suspended last year to preserve capital and ensure that lenders can support the UK economy in the event of a severe economic downturn.
“These good results reflect the return of growth in our major markets and the significant progress in the execution of our strategy,” Quinn said.
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Quinn said that in the United Kingdom, HSBC’s mortgage loans have set a record quarter, and since June last year, total loans have increased by 9%, or $5.1 billion. It helped drive the overall mortgage loans of the entire group increased by 7% during the year, reaching US$24 billion.
Mortgage loan data covers The last months of the temporary stamp duty holiday, Which was launched to support the UK housing market during the Covid-19 crisis, but caused house prices to rise, forcing some borrowers to obtain larger housing loans. Data from Zoopla shows that UK house prices hit a new high in June, 30% higher than the peak reached before the 2008 financial crisis. The stamp duty exemptions for Wales and Scotland have ended, and the stamp duty exemptions for England and Northern Ireland have ended in September.
HSBC said that it expects the UK GDP to grow by 6.1% in 2021, and the unemployment rate will reach an average of 5.8% by the end of the year. House prices are expected to rise by an average of 8.3% throughout the year.
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