HSBC’s third-quarter profit drops 14%, beats estimates

Europe’s largest lender HSBC on Tuesday beat third-quarter profit expectations on the back of revenue growth, which included a rise in the bank’s net interest income and a robust performance in its wealth segment.

The bank’s profit before tax for the three months ended in September was $7.3 billion, down nearly 14% from a year ago due to higher operating expenses, namely from notable items, including legal provisions of $1.4 billion.

Here are HSBC’s second-quarter 2025 results compared with consensus estimates compiled by the bank.

• Profit before tax: $7.3 billion vs. $5.98 billion
• Revenue: $17.8 billion vs. $17.05 billion

The earnings come a day after the bank said it will recognize a provision of $1.1 billion in its third-quarter results following a court ruling in Luxembourg related to the Bernard Madoff investment fraud case.

The case stems from a 2009 lawsuit by Herald Fund SPC against HSBC’s Luxembourg arm, seeking the return of securities and cash allegedly lost in the fraud.

The court rejected the HSBC unit’s appeal on the securities restitution claim, though it accepted its challenge about the cash portion.

HSBC said it plans to file a further appeal with the Luxembourg Court of Appeal and, if that fails, it will dispute the final amount in later proceedings.

The bank said the $1.1 billion provision will trim its Common Equity Tier 1, or CET1, capital ratio by roughly 15 basis points. The CET1 ratio is a key indicator of a bank’s financial strength.

—CNBC’s Lim Hui Jie contributed to this report.