HSBC bank racks up record £11.9bn profits

HSBC smashed the record for annual profits by a UK bank today when it unveiled a surplus of $20.97bn (£11.91bn/€17.4bn) for 2005.

The group said the figure was 11% higher than its haul of the previous year after its core businesses in the UK, United States and Hong Kong produced “robust performances”.

Charges for bad loans rose by $1.61bn (£914.9m/€1.3bn) during the year and came against a backdrop of rising personal bankruptcies in the UK, which generates around one-fifth of HSBC’s earnings.

Announcing total impairment charges of $7.8bn (£4.43bn/€6.5bn) across its global operations, HSBC said action taken to tackle bad debts in the UK began to have a positive effect during the final six months of 2005.

Today’s results come a week after Royal Bank of Scotland unveiled profits of £8.25bn (€6.8bn) before accounting for one-off items, while Lloyds TSB and Barclays have also cheered the City with bumper earnings.