By Margot Patrick 

HSBC Holdings PLC abandoned its main financial target and said it would speed up plans to revamp its U.K., U.S. and European businesses as tougher market conditions hit its third-quarter earnings.

Net profit fell 24% in the quarter, to $2.97 billion. A FactSet poll of analysts had tipped a net profit of $3.96 billion for the quarter.

Noel Quinn, in the job since August as interim chief executive, said Monday that the bank's business in Asia held up well in the quarter despite challenges that included violent antigovernment protests in Hong Kong and a continuing U.S.-China trade dispute. But he said previous plans to improve performance in its U.K investment bank, U.S. unit and continental European operations "are no longer sufficient."

HSBC shares were down 2.82% in early trading.

Mr. Quinn dropped a target for next year to make at least an 11% return on tangible equity, and said plans are being accelerated to " remodel" the lagging units and free up capital to put elsewhere. New strategic plans and financial targets will be set at full-year results in February, if not sooner, the bank said.

As a result, HSBC said it expects to take significant charges in the fourth quarter and beyond, including the possible impairment of goodwill and restructuring charges.

The bank said Monday it has too much capital tied up in Europe and in its global banking and markets division, and that returns are "insufficient" in the U.S. It is planning to sell its large French retail bank, The Wall Street Journal previously reported. It also said it would continue to simplify the bank and reduce costs.

Mr. Quinn replaced former CEO John Flint after the bank's board decided it needed a leadership change to address worsening economic conditions.

--Yifan Wang contributed to this article.

Write to Margot Patrick at margot.patrick@wsj.com

 

(END) Dow Jones Newswires

October 28, 2019 04:26 ET (08:26 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
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