In an announcement of HSBC Bank Malta’s Q3 results, where a pre-tax profit of €118 million was announced, the bank stated that it “remains focused on running its business and will provide further updates as required”.
It made the remarks within the context of HSBC Holdings’ announcement of a strategic review of its 70.03 per cent shareholding in HSBC Malta. Following the announcement, WhosWho.mt exclusively broke the story that APS Bank are in talks to acquire HSBC’s Malta outfit.
In the Q3 announcement, HSBC Malta CEO Geoffrey Fichte said “HSBC remains full open for business, providing the full range of lending services from mortgages, personal loans, cards to long term lending to companies, including energy efficiency loans. On behalf of the entire HSBC Bank Malta team, I would like to thank our customers for their business and our colleagues for their professionalism and support.”
During 2024’s third quarter (Q3), HSBC Bank Malta plc reported a pre-tax profit of €118 million, marking an increase of 17 per cent over the €100.8 million reported in the same period last year.
The bank attributed the growth to its diversified nature of the business and customer base, supported by a higher interest rate environment. Furthermore, good progress was reported in non-interest income as well as robust risk management reflected in continued Expected Credit Losses (ECL) recoveries.
This was announced in the Interim Directors’ Statement issued through the Malta Stock Exchange.
Revenue was up by €19 million (11 per cent) when compared to the corresponding period. This was mainly driven by higher customer activity amidst the higher interest rate environment, as the average interest rates in the first nine months of 2024 were higher than the same period in 2023.
Non-funds income also increased by €2.8 million compared with the same period in 2023 with an improvement registered in net fee income, international trade services, foreign exchange and insurance income.
The bank shared that it has recorded an improvement in the credit quality of its loan book, resulting in a release in ECL of €10.8 million in Q3 2024 compared to a release of €3.7m in Q3 2023. The Q3 2024 release reflected recovery on non-performing loans, a release of provisions held for inflationary pressures which did not materialise as well as a general improvement in the credit quality of the book.
Operating expenses increased by 12 per cent compared to the same period last year. While there were some one-off items, the underlying drivers were increases in staff costs, IT expenses and real estate costs as the bank continues to invest in people, customer experience, technology and new headquarters in Qormi.
In Q3 2024, the bank implemented a new mortgage system. Furthermore, the roll-out of new ATMs also commenced in line with our plan to replace all ATMs by 2025. Other significant digital improvements are on track.
Net loans and advances to customers decreased marginally compared with 31st December 2023. Customer deposits decreased from year-end, mainly driven by a decrease in operational corporate deposits which can be seasonal but increased compared to 30th September 2023. The Bank’s liquidity position remained strong and regulatory capital ratios continued to exceed regulatory capital requirements.
In the announcement, Mr Fichte also commented on the bank’s financial performance:
“We continued our strong business momentum focused on supporting our customers with a 17 per cent growth in pre-tax profit over prior year. We’re pleased to report higher customer activity, the launch of new products including in wealth management, investment funds and insurance and continued to invest in our people and technology in order to make banking simpler, easier and safer for our customers. Our levels of capital and liquidity remain robust amongst the highest in the market.”
