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The executive president of HSBC, Georges Elhedery, has said that it is “critical” that the dollar maintains its position as the dominant currency while describing the impact of commercial tariffs on the bank’s business.
“The trust and confidence in this asset without risks are essential,” he said during a call with journalists on Tuesday after HSBC announced his results of the first quarter. “We do not see a change in the position of the US dollar as the commercial currency.”
While the “participation of the lion” of commerce was financed using the dollar, Elhedery said that there had been an increase in the use of Renminbi, which now represents approximately 7 or 8 percent of commercial finances worldwide.
The state of the dollar as a global currency has been questioned since President Donald Trump announced a high -range tariff regime that has undermined confidence in the US currency.
HSBC, which is among the largest institutions of compensation of dollars worldwide and is in the nexus of global trade, is expected to be among the businesses affected by an intensifying commercial war between the two largest economies in the world.
“We have seen a significant fall in [trade] Volumes along the United States China corridor in the sectors that have not been given an exemption or a reduction in tariffs, ”said Elhedery.
The comments occurred as HSBC increased its dispositions for bad loans and the planned loans would be silenced this year, citing uncertainty, market agitation and a deteriorated economic perspective of higher rates and geopolitical tensions.
The bank based in the United Kingdom increased its expected credit losses by $ 202mn to $ 876mn in the first quarter of 2025, slightly higher than analysts’ estimates. The year -on -year increase included $ 100 million specifically for its exposure to the commercial property sector of Hong Kong.
“Given the current levels of uncertainty and market agitation,” the bank expects the global loan demand “to remain silenced for 2025”.
Projected an impact of “percentage of a single digit” under its income and additional $ 500 million on incremental provisions of bad loans on a stage with “significantly higher rates.”
HSBC announced a repurchase of shares of up to $ 3 billion that would begin after its annual meeting on May 2. Declared a dividend of the first quarter of $ 0.10 per share. The Bank London list shares increased 2.6 percent on Tuesday.
Profit before taxes fell 25 percent to $ 9.5 billion in the first three months of the year, exceeding the expectations of analysts of $ 9.1 billion compiled by Bloomberg. They were $ 12.7 billion a year earlier, when he registered unique net profits related to sales of their units in Canada and Argentina.
The gains of the group of wealth and main banking of the group increased slightly year after year, driven by a growth of $ 250mn in wealth revenue that the lendist proved the increase in trade through its brokerage.
HSBC also said that his participation in the Communications Bank would be diluted from 19 percent to 16 percent after the Chinese lender announced a plan to issue RMB120 billion shares ($ 16.5 billion), which resulted in a paper loss of up to $ 1.6 billion for HSBC.
Barclays analysts labeled the “positive” results, pointing out the strongest performance than expected of the Bank’s Heritage Management Division and strong deposit growth in Hong Kong. “Although a certain degree of caution near the uncertainty of the commercial rate,” they said on Tuesday.
Since he became executive director in September, Elhedery has embarked on a cost reduction plan that involves $ 300 million savings in 2025 and a total of $ 1.5 billion of its annual cost base at the end of 2026.
Elhedery, in a call with journalists, said that Ring’s head must withdraw or climb significantly as British banks expand pressure on the government to get rid of the rules after the crisis that they say that the competition stifles.
“The result of the rings strip is that costs has increased, has created capital and liquidity inefficiencies trapped and, therefore, presented companies in the United Kingdom and specifically to SMEs to a much higher cost base,” Elhedery said. “He has suffocated competition in the United Kingdom Banking,” he added.
