HSBC's pre-tax profit jumped by nearly a third in the third quarter, reaching 9.6 billion US dollars (£7.2 billion) for the three months to September, a 32% increase compared with the same period last year. The banking giant is nearing the end of a two billion US dollar (£1.5 billion) cost-cutting programme, having already made bigger savings than originally planned.
Cost savings and shareholder returns
The profit growth was driven by higher interest income, lower expected credit losses, and a smaller provision for legal costs than in the same period last year. HSBC also announced it would hand up to one billion dollars (£750 million) to shareholders as part of a new share buyback scheme.
Operating expenses – the day-to-day spending of a business, including salaries – were 1.3 billion dollars (£980 million) lower than the same time last year. The cost-cutting drive was kick-started by chief executive Georges Elhedery in 2025, who set a target to reduce the cost base by around 1.5 billion dollars (£1.1 billion) a year by the end of 2026.
AI skills and workforce focus
HSBC said it had beaten this target with cost savings worth 1.9 billion dollars (£1.4 billion), which it expects to reach two billion dollars (£1.5 billion) by the end of the year. Chief financial officer Pam Kaur said the savings have come from “a range of places”, including the “deduplication of roles”, which particularly impacted more senior positions. She also said the bank was encouraging staff to build their AI skills and be “future-ready”.
“And that’s so important for us because, in our judgment, what’s most important for an AI strategy to work is to keep the human accountability, judgment and decision-making very much at the core of what we do,” she said. “So AI is there to help humans, not necessarily to replace humans. We know that AI will change how work is done across industries, and of course, it will impact some roles, it will transform other roles, while creating entirely new roles.”
Potential job cuts in UK wealth management
Reports, according to the Financial Times, said the bank was preparing to cut jobs in its UK wealth management business as part of efforts to ramp up AI use to serve wealthy customers more efficiently. The reports suggest the bank plans to cut around half of its management and specialist roles in the business, while reductions among financial advisers could reach around 70%.
Ms Kaur said she would not comment on the speculation about job losses but that the bank “absolutely focuses on the workforce we have, both in terms of skilling it and building on it”. Mr Elhedery said: “Our performance shows that in a more complex world, clients continue to turn to us to navigate uncertainty and seize new opportunities. It also reflects consistent execution of our strategic priorities with pace, precision and discipline. As we simplify HSBC, we are creating greater capacity to invest, grow and deliver strong returns for our shareholders.”
