HSBC reported an adjusted pre-tax profit of $6.5bn vs. $5.5bn a last year, and beat estimates of a $6bn results during its Q3 release. Revenues rose 28% YoY to $14.3bn with the benefit of higher interest rates being felt across all of its businesses. The banking major however reported a provision for expected credit losses of $1.07bn, citing a weak Chinese real estate market and a “mild recession” in the UK. HSBC’s CET1 ratio was 20bp lower QoQ to 13.4%, partly due to the $2.3bn hit it took on sale of its French business. HSBC’s dollar bonds were trading slightly higher with its 6.375% Perp up 0.4 points to 90.16, yielding 12.4% to call.
UBS reported a 24% YoY drop in its Q3 net profits to $1.7bn, although it was above estimates of $1.5bn. The bank reported revenues of $8.2bn, down 9% YoY. Its flagship wealth management division reported a 4% drop in revenues to $1.5bn. The CEO Ralph Hamers said that clients on its wealth business were looking for alternative investments and cash, and that predicts weak activity on the institutional side of its trading unit in Q4. Its CET1 ratio stood at 14.4%, up 20bp from the previous quarter. All eyes now turn towards its peer Credit Suisse’s earnings that are due tomorrow. UBS’s dollar bonds were slightly higher with its 7% Perp up 0.4 points to 96.5, yielding 8.7% to call.