Profits at the world’s largest bank, HSBC, have more than doubled as a result of rising interest rates globally.
The London-based lender reported a pre-tax profit of $21.7 billion (£16.9 billion) for the first half of this year, up from $9.2 billion in the same period last year.
Additionally, a $1.5 billion provisional gain from its acquisition of the British division of the defunct Silicon Valley Bank (SVB UK) increased that amount.
In an effort to stop price increases, central banks have raised interest rates.
“There was good broad-based profit generation around the world, higher revenue in our global businesses driven by strong net interest income, and continued tight cost control,” said HSBC chief executive Noel Quinn.
Despite the sharp increase in profit, the bank, which receives around two-thirds of its income from Asia, issued a warning over the hazy economic picture.
It stated that clients in the UK may see special pressure as households are squeezed by a combination of high inflation and rising interest rates.
“With more mortgage customers due to roll off fixed-term deals in the next six months, and further rate rises expected, tougher times are ahead,” Mr Quinn said.
In the UK, there is pressure on banks and building societies to pass on interest rate increases to depositors.
Banks were warned on Monday that they would face “robust action” if they gave their clients unjustifiably low savings rates, according to the UK’s banking watchdog.
The warning from the Financial Conduct Authority (FCA) is a part of a strategy to make sure banks pass on interest rate increases to savers.
In an effort to lower inflation, the Bank of England has already increased its base rate 13 times in a row. On Thursday, another increase is anticipated.
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