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Europes Biggest Bank Announces Further Losses

Wed, 12 Nov 2008

HSBC has announced it is to cut 1,100 jobs worldwide after announcing further losses in the third quarter. A difficult third quarter took US sub-prime related losses to £2.7 billion, as the bank continues to battle against the ‘enormous challenges’ presented by the current financial gloom, the bank said. Whilst revealing an uncertainty over whether there are ‘further risks to be uncovered’ in the financial sector, the bank announced its investment banking unit made a $600 million loss in credit crunch related losses.

The losses come on top of the £1.8 billion second quarter write-downs, though the bank are claiming its third quarter profit was higher than during the same period in 2007. That said, the bank conceded that pre-tax profit for the nine months ended 30th September 2008 was lower than the equivalent period in 2007.

Michael Geoghegan, HSBC group chief executive, said, ‘These are extraordinary times in our industry. He went on to assert that although the results were disappointing, they aren’t in line with either the bank’s expectations or the current performance of other financial institutions. He also conceded that the ‘current trends point to further deterioration in the near to medium term.’
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