By Anjie Zheng And Margot Patrick
HONG KONG-- HSBC Holdings PLC said on Monday it will sell its
Brazil business to Banco Bradesco SA in an all-cash deal worth $5.2
billion, as it continues to reshape its operations with an eye
toward improving profits.
The bank, which is also close to selling its business in Turkey,
announced the deal as it said second-quarter net profit fell nearly
4% to $4.36 billion from $4.54 billion a year earlier. Bad loans
fell and the bank booked a $1 billion gain in the second quarter on
the sale of part of its stake in China's Industrial Bank Co.
Pretax profit rose 10% in the first half of the year to $13.63
billion from $12.34 billion a year earlier.
Adjusted operating expenses rose 7% to $17.64 billion in the
first half. That figure has been closely watched by analysts
because high costs used to comply with banking rules have tempered
the benefits of the bank's restructuring.
Four years ago, Chief Executive Stuart Gulliver kicked off an
effort to pull HSBC out of countries where it lacked scale or
didn't make enough money. He stepped up the program in June with a
plan to cut 50,000 jobs and shave up to $5 billion from its annual
costs by 2017.
The bank's regulatory woes have often overshadowed its strategy,
though, as a host of regulators and authorities globally have found
weaknesses in HSBC's anti-money-laundering controls and the
governance at some of its units. Fines, settlements and systems
cleanups have cost the bank billions of dollars in the past few
years and have weighed on returns.
Write to Anjie Zheng at Anjie.Zheng@wsj.com and Margot Patrick
at margot.patrick@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires