HSBC Global Markets Division Posts YoY Gains, FICC Rises 2%
- Solid market making at HSBC highlights the company as one of the few banks that have performed well in a challenging quarterץ
HSBC’s Global Markets division has posted a solid quarter despite industry-wide headwinds. A number of investment banks have already reported significant declines in revenue this year due to low Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders Read this Term. Fixed income and currencies have been particularly hard hit in an environment of continually compressing client activity.
Adjusted revenues at the Global Markets division increased by 7 percent to $5.4 billion. Trading at the Fixed Income, Currencies and Commodities unit generated $4.4 billion which is higher by 2 percent year-on-year. Foreign exchange declined 3 percent to account for $1.95 billion.
Compensation at HSBC Remains Competitive
Many peers of HSBC in the UK, Europe, and the US have materially underperformed when compared to last year, losing between 20 and 40 percent of revenues on a year-on-year basis. The London-headquartered bank has managed to hold its positions solid.
Not only that but the company marked an increase in costs which was primarily driven by higher compensation. HSBC’s operating expenses were higher by 4 percent, reflecting higher performance-based pay, pension and severance costs. The company also continued strategic investment into its foreign exchange business. A broader synopsis of the institutional and retail industry will be a marquee topic of discussion at the 2017 Finance Magnates London Summit this November.
Commenting on the results during the company’s earnings call, CFO Iain James Mackay said: “Global Banking & Markets continued to grow revenue despite a challenging quarter for the industry, demonstrating the benefits of its differentiated business model.”
“It achieved this largely through growth in Global Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term and Cash Management, Equities and Securities Services, which exceeded the impact of subdued market activity on our banking and fixed income businesses,” he elaborated.
Despite subdued market activity, HSBC’s continuing market share gains contributed to a very positive quarter when compared to industry peers. A material, 25% increase in equities revenue was all but eliminated from the impact of lower fixed income revenues.
HSBC’s Global Markets division has posted a solid quarter despite industry-wide headwinds. A number of investment banks have already reported significant declines in revenue this year due to low Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders Read this Term. Fixed income and currencies have been particularly hard hit in an environment of continually compressing client activity.
Adjusted revenues at the Global Markets division increased by 7 percent to $5.4 billion. Trading at the Fixed Income, Currencies and Commodities unit generated $4.4 billion which is higher by 2 percent year-on-year. Foreign exchange declined 3 percent to account for $1.95 billion.
Compensation at HSBC Remains Competitive
Many peers of HSBC in the UK, Europe, and the US have materially underperformed when compared to last year, losing between 20 and 40 percent of revenues on a year-on-year basis. The London-headquartered bank has managed to hold its positions solid.
Not only that but the company marked an increase in costs which was primarily driven by higher compensation. HSBC’s operating expenses were higher by 4 percent, reflecting higher performance-based pay, pension and severance costs. The company also continued strategic investment into its foreign exchange business. A broader synopsis of the institutional and retail industry will be a marquee topic of discussion at the 2017 Finance Magnates London Summit this November.
Commenting on the results during the company’s earnings call, CFO Iain James Mackay said: “Global Banking & Markets continued to grow revenue despite a challenging quarter for the industry, demonstrating the benefits of its differentiated business model.”
“It achieved this largely through growth in Global Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term and Cash Management, Equities and Securities Services, which exceeded the impact of subdued market activity on our banking and fixed income businesses,” he elaborated.
Despite subdued market activity, HSBC’s continuing market share gains contributed to a very positive quarter when compared to industry peers. A material, 25% increase in equities revenue was all but eliminated from the impact of lower fixed income revenues.