HSBC reports double profit after rising interest rates 

Banking giant HSBC earnings have more than doubled as it profited from skyrocketing interest rates worldwide.

The London-based lender declared a pre-tax profit of $21.7bn (£16.9bn) for the first six months, compared to $9.2bn a year before.

Rising interest rates all over the world, HSBC sees double profit: 

That figure was even boosted by a $1.5bn provisional income from buying collapsed Silicon Valley Bank’s British business (SVB UK). Central banks have raised interest rates as they try to impede cost rises.

“There was good broad-based profit generation around the world, higher revenue in our global businesses driven by strong net interest income, and continued tight cost control,” stated HSBC chief executive Noel Quinn.

Despite the rise in profit, the bank – which earns around two-thirds of its income from Asia – warned of the uncertain economic perspective.

It noted that UK consumers may come under certain pressure due to the high inflation and increasing interest rates squeezing families.

“With more mortgage customers due to roll off fixed-term deals in the next six months, and further rate rises expected, tougher times are ahead,” Mr Quinn stated.

Banks and building communities in the UK have come under pressure to pass on the interest rate increases to savers. On Monday, banks offering inexcusably low savings rates to their clients were told they would face “robust action”, the UK’s economic watchdog said.

The Financial Conduct Authority’s (FCA) notice came as part of a plan to guarantee banks are passing on interest rate increases to savers. The Bank of England has increased its base rate 13 times to curb inflation and is anticipated to raise it again on Thursday.

However, while mortgage interest rates have climbed quickly, savings have grown gradually, especially for easy-access accounts. In May, HSBC said its earnings would receive a $1.5bn boost from the purchase before in the year of SVB UK for a nominal £1 ($1.25) in a contract led by the government and the Bank of England.