Reported profit before tax fell from $14bn in the first half of 2013 to $12.3bn, while reported revenue fell from $34.4bn to $31.2bn.
Despite across-the-board falls, group chief executive Stuart Gulliver said the results demonstrated the “resilience” of the company’s business model in a period of “regulatory uncertainty”.
“Our balance sheet remains strong and our continuing ability to generate capital supports both growth and our progressive dividend policy.”
Group chairman Douglas Flint added: “This [performance] was achieved while continuing to invest significant time and resources in re-shaping the group to meet the heightened and evolving expectations of our regulators.
He said that due to “residual concerns” over the sustainability of economic growth in many markets, the board had supported management’s view that this was “not the time to expand risk appetite”.
The bank also put aside $234m for its customer redress programmes which covers matters such as disputes over advice given by its wealth management arm, mis-sold interest rate swaps and PPI claims.
Flint said the company hopes to reduce the "severity of future customer redress" in the future, but added that there was a danger of disproportionate risk aversion “creeping in” to businesses as individuals grow increasingly wary about what may be criticised, leading them to develop a “zero tolerance of error”.
Unwarranted risk aversion
He added that this “unwarranted” risk aversion could ultimately restrict access to the formal financial system.
“It risks unwinding parts of the eco-system of networks and relationships that support global trade and investment,” he said. “We can address this behaviour through training and leadership, but we also need clarity from public policy and regulatory bodies over their expectations in this regard.”
Profits in HSBC’s retail banking and wealth management division meanwhile, fell $558m to $3bn over the period, compared with 2013.
Last month, HSBC announced that it would be selling parts of its Cayman Islands corporate and retail banking business to Butterfield Bank.
The assets to be transferred from HSBC add up to $800m, and the transfer is expected to be completed in the fourth quarter of 2014.
