The UK’s big banks need to keep a close watch on risks

Posted On Sep 4 2021 by

That was until HSBC upset the applecart yesterday with a disappointing set of results and a series of stark warnings about the upcoming European elections, potential protectionism from the US, and uncertainties arising from Brexit.Read more: HSBC shares drop 6.5 per cent as bank reveals 62 per cent profit hitThe other FTSE quoted banks may be very different beasts to HSBC, ranging from a UK-focused retail bank in the form of Lloyds, to Barclays which is keeping a foot in the investment banking camp, and RBS, which has a plateful of problems to digest.But the warnings from HSBC, Britain’s largest bank, underscore that banks are big, complex companies which are exposed to trends that are very hard to forecast correctly: central bank interest rate decisions, currency movements, stock and bond markets and unpredictable global growth levels.Read more: HSBC reveals it’s being probed over money laundering issues Tracey Boles by Taboolaby TaboolaSponsored LinksSponsored LinksPromoted LinksPromoted LinksRelated ArticlesTop 10 Date Night In Movies & Films Of All TimeUndoMushroom Stuffed Pizza: Delicious Recipes Worth CookingUndoCheesy Bacon Dip: Recipes Worth CookingUndo Ad Unmute by Taboolaby TaboolaSponsored LinksSponsored LinksPromoted LinksPromoted LinksYou May LikeCookingAmour12 Best Natural Immunity Boosters For Cold And Flu This WinterCookingAmourUndoPaws ZillaIf A Bear Attacks You, Do What This Navy SEAL SaysPaws ZillaUndo22DailyThis Historic Photo Has Never Been Edited. Take A Closer Look22DailyUndoPOM Industries LLCPOM Pepper Spray – Next Generation of Performance, Quality and SafetyPOM Industries LLCUndoHappy Pumpkin10 Delicious Freezer Meal Recipes to Dump into the Slow Cooker – Happy PumpkinHappy PumpkinUndotibgez10 Signs & Symptoms of Lewy Body DementiatibgezUndoCremations | Search AdsHow Much Does It Cost To Be Cremated In Scottsdale?Cremations | Search AdsUndoHealthline: Medical information and health advice15 Evening Habits that are Definitely Bad for Night’s SleepHealthline: Medical information and health adviceUndoTrendybuzz11 Efficient Arm Workouts To Build Might & MuscleTrendybuzzUndo Less than a week ago, analysts were predicting that the UK’s banks could be about to turn a corner.Mega-fines appeared to be tailing off, signalling an end to the failings of the past. It was no secret that fresh challenges lay ahead for the sector, notably the costs of ringfencing and IT legacy issues, but the City was confidently expecting some strong results from the reporting season. Little wonder that Russ Mould, investment director at AJ Bell, says that banks are really in the risk-management business.This is not something they have always performed well at in the past. The reason that compliance costs are growing and ringfencing costs exist is because behaviour in the run up to the credit crunch was far, far too risky. Mould suggests banks become like the quasi-utilities of the past: safe and steady providers of credit.Read more: Banks fear rising risk costs are just around the cornerLess risk may well mean lower growth, but if that spells more stable profits, fewer provisions and fatter dividends, the benefits could be substantial to customers and shareholders alike. Nearly a decade on from the credit crunch, banking is still in transition.How it all ends for the UK’s banking behemoths, and their shareholders, is in their own hands as much as regulators.What is required in the face of numerous challenges is constant vigilance around risk, as well as adaptability. Otherwise, the fines, losses and writedowns will continue and the spectre of another crisis will haunt the sector. Wednesday 22 February 2017 5:00 am The UK’s big banks need to keep a close watch on risks whatsapp whatsapp Share

Last Updated on: September 4th, 2021 at 9:54 am, by

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