HSBC profit more than doubles- Commentary from the CEO of My Community Finance
HSBC has witnessed a substantial surge in profits, with its pre-tax earnings surging by over 100%, reaching £16.9 billion in the initial half of this year. This notable upswing has been attributed to the impact of escalating global interest rates.
To counteract elevated inflation, central banks have been implementing interest rate hikes. However, UK regulatory authorities have expressed apprehensions about banks inadequately passing on these rate increases to savers.
HSBC's revenue growth owes much to the expanded difference between its income derived from products like loans, mortgages, and securities, and the interest paid on customer deposits, issued debt, and other financial offerings.
While mortgage interest rates have experienced rapid escalation, the growth of savings rates, particularly in easy access accounts, has not kept pace.
In response, the Financial Conduct Authority has asserted that banks providing disproportionately low savings rates to their clients will now be met with "vigorous action".
The CEO of My Community Finance, Tobias Gruber, said: “I find it concerning that despite HSBC's massive profit surge there seems to be a lack of commitment to passing on the benefits to their customers. The substantial increase in profits, fueled by rising interest rates globally, should prompt banks like HSBC to prioritise their customers by offering fairer savings rates and mortgage terms.
“It’s imperative that financial institutions act responsibly and ensure that their customers receive their fair share of the prosperity. We firmly support the FCA’s warning to take robust action against banks offering unjustifiably low savings rates. Customers deserve better treatment, especially when banks like HSBC report record profits.”
About Tobias Gruber
Tobias Gruber is the founder and CEO of My Community Finance. For the past 30 years, he's been a prominent leader in investment banking and asset management for some of the sector's most renowned banks, including Credit Suisse, SwissBank, JP Morgan and Morgan Stanley.
Fast forward to 2018, Tobias launched My Community Finance to provide a platform for the financially excluded, helping people to get back on their feet with ethical and socially responsible lending. Within 36 months, My Community Finance has become accountable for 25% of borrowing within the credit union sector.
Tobias has experienced first-hand how certain areas of the finance world are ripe for change and is a passionate advocate for using fintech to help people and solve society's economic problems.
About My Community Finance
My Community Finance is on a mission to transform how its customers manage their money by giving them access to ethical alternatives through two of the U.K.'s biggest credit unions: My Community Bank and Castle Community Bank.
Credit unions give a lifeline to customers who struggle to access mainstream credit by introducing them to financial communities that don't prioritise profits and whose unique regulatory structure means they can offer fairer rates.
Based in London and launched in 2018, My Community Finance is fully authorised and regulated by the Financial Conduct Authority and is a trading name of Amplifi Capital (U.K.) Limited, which has offered ethical and responsible financial products to near-prime consumers since 2015.
