LONDON (AP) — Europe’s biggest bank, HSBC, said Monday that its net profit plummeted 96% in the second quarter of this year as lower interest rates combined with the downturn due to the coronavirus pandemic tool hold.
The bank’s net profit was $192 million in the April-June quarter, down from $4.37 billion reported in the same period a year earlier.
London-based HSBC has most of its business in Asia.
Near-zero interest rates meant to help businesses keep running with cheap credit are squeezing margins for lenders. The bank forecasts expected credit losses of $8 billion-$13 billion in 2020, though it said that was “subject to a high degree of uncertainty.”
Earlier this year, the bank said it will shed some 35,000 jobs as part of an overhaul to focus on faster-growing markets in Asia and as it tries to cope with a slew of global uncertainties, from Brexit to the trade wars to the pandemic.
The bank’s chief executive, Noel Quinn, said in a presentation posted online that HSBC paused its restructuring efforts in the last quarter to focus on supporting its customers.
The bank’s net profit fell 53% to $6 billion in 2019.
