HSBC Q3 profits fall as $1.1bn legal charge weighs

(Sharecast News) - HSBC on Tuesday reported a fall in third-quarter profits as a $1.1bn legal charge weighed on the bottom line. Pre-tax profit for the three months to September fell 14% to $7.3bn. Net interest income for the quarter rose 15% year on year to $8.8bn, driven by a 30% jump in income from its wealth division to $2.68bn.

Operating expenses rose 24%, as it set aside provisions including $1.1bn after losing an appeal in a long-running lawsuit in Luxembourg related to Bernard Madoff's multibillion-dollar Ponzi scheme.

The bank said it now expected full-year banking net interest income of $43bn, citing rising confidence in the near-term trajectory for policy rates in key markets such as the UK and Hong Kong.

It also guided for double-digit percentage average annual growth in fee and other income from its wealth division over the medium term.

Reporting by Frank Prenesti for Sharecast.com