Matt Britzman, senior equity analyst at Hargreaves Lansdown, says HSBC's (LSE:HSBA) first quarter was stronger beneath the surface after underlying revenue climbed 4% to $19.1bn even as underlying profit before tax remained flat at $10.1bn.
He argues the upside was driven by a robust Wealth performance, solid fee income and net interest income broadly in line with expectations, and notes the bank nudged up full‑year net interest income guidance, suggesting customer activity and the Asian wealth franchise are doing more of the heavy lifting than rates alone.
Britzman warns that the top‑line gains were eaten before they hit the bottom line because credit losses were heavier than expected, including a UK fraud‑related charge and extra caution on the Middle East, while costs ran above consensus as performance pay, inflation and technology spend bit into profits, leaving reported numbers a touch light even though capital landed where expected.
“The core franchise looks healthy, but HSBC still needs to prove it can keep a lid on costs and impairments if the market is going to give full credit for that stronger revenue base,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
