HSBC Bank Malta plc has reported record financial results for the year 2024, registering a profit before tax of €154.5 million, an increase of €20.6 million (15 per cent) compared to 2023.

This was primarily driven by revenue growth across all business lines, recoveries on expected credit losses, and strategic investments.

Key financial highlights

• Profit before tax: €154.5 million (+15 per cent year-on-year)
• Profit after tax attributable to shareholders: €100.1 million
• Earnings per share: 27.8 cents (compared to 24.1 cents in 2023)
• Return on equity: 17.5 per cent (up from 17.1 per cent in 2023)
• Total dividend for 2024: 22.0 cents per share (14.3 cents net of tax), the highest in a decade
• Net interest income: €206.1 million (+5 per cent year-on-year)
• Net fee income: €20.9 million (+€1.4 million)
• Net trading income: €9.7 million (+27 per cent)
• Operating costs: €112.8 million (+10 per cent)

The dividend payout ratio was set at 51 per cent of reported profits, with a final gross dividend of 12.0 cents per share (7.8 cents net of tax). The final dividend will be paid on 20 May 2025, subject to shareholder approval at the Annual General Meeting (AGM) on 13 May 2025.

HSBC Malta’s strong results were attributed to several factors, including:

• Higher interest rates: The European Central Bank (ECB) began lowering rates in mid-2024, but the average rate for the year remained higher than in 2023.
• Increased customer activity: Growth in transaction banking, international payments, and asset management services contributed to higher revenues.
• Credit portfolio improvements: The bank recorded a €14.6 million release in expected credit losses, compared to €4.6 million in 2023, largely due to improved loan quality and economic outlook.
• Operational investments: HSBC Malta expanded its digital banking offerings, ATM network, and mortgage systems, and inaugurated its new headquarters, HSBC Hub, in Qormi.

Sector performance

• Retail & commercial banking: Reported higher customer deposits, which increased by €16.8 million to €6.158 billion.
• Lending portfolio: Net loans and advances to customers fell by €210.7 million to €2.873 billion, reflecting a focus on improving asset quality and reducing non-performing loans.
• Insurance: HSBC Life Assurance (Malta) Ltd recorded €14.4 million in profit before tax, compared to €6.2 million in 2023. This improvement was mainly due to a one-off tax reassessment and the reversal of losses on previously unprofitable insurance contracts.

Capital and liquidity position

HSBC Malta continues to maintain capital and liquidity ratios well above regulatory requirements:

• Common equity tier 1 ratio: 22.6 per cent (up from 20.6 per cent in 2023)
• Total capital ratio: 25.6 per cent (up from 23.5 per cent)

The bank’s financial investment portfolio grew by 74 per cent to €2.291 billion, as part of a strategic move to stabilise interest income and reduce exposure to interest rate fluctuations.