HSBC record profits: Positive Money response

London, 21 February 2024 – Positive Money responds to HSBC’s announcement today that its pre-tax profits 2023 were £24 billion, up from £13.9 billion in 2022.

Fran Boait, co-executive director at Positive Money, said:

“It’s safe to say HSBC didn’t earn these record profits by providing a better service to customers, given that it closed a quarter of its bank branches last year. These are unearned windfall profits from higher interest rates.

“What we’re seeing is banks profiteering from poverty, which tens of millions of households are now living in, in part due to the same high interest rates which have enriched the banks.   

“To rebalance the unequal impact of high interest rates, the government must use a windfall tax on bank profits to pass all that excess money back to the struggling households it was stripped from.”

Notes:

• HSBC’s profit announcement can be found here: https://www.hsbc.com/news-and-views/news/media-releases/2024/hsbc-holdings-plc-annual-results-2023 

• Which? reports that HSBC closed 114 bank branches in 2023 – a quarter of its UK bank branches: https://www.which.co.uk/news/article/hsbc-to-close-114-branches-in-2023-aLWUH0R6u237 

• UK poverty statistics, December 2023: https://commonslibrary.parliament.uk/research-briefings/sn07096/ 

• Higher interest rates mean that the Bank of England is expected to pay an estimated £75bn of interest on banks’ risk free reserves over 2023 and 2024, with a total of around £150bn due to be paid out between 2022 and 2028. For more information see: http://positivemoney.org/wp-content/uploads/Bank-windfall-tax-briefing-2.pdf 

• Positive Money is petitioning for this windfall to be taxed: https://actionnetwork.org/petitions/tell-hunt-to-tax-the-banks/ 

• Calls for a windfall tax on banks have been echoed by MPs, including Angela Eagle, John McDonnell, Clive Lewis, Diane Abbott and Richard Burgon

• Polling commissioned by Positive Money in September 2023 found the majority of the public supports a windfall tax on banks: https://positivemoney.org/2023/09/uk-public-support-windfall-tax-on-banks-polling-shows/ 

About:

Positive Money campaigns for a money and banking system which supports a fair, democratic and sustainable economy. Set up in the aftermath of the financial crisis, Positive Money is a not-for-profit company funded by charitable trusts and foundations, as well as small donations from its network of over 65,000 supporters. www.positivemoney.org