British Banks Raise Hope Of Recovery

JANE WARDELL

LONDON (AP) — Britain's two biggest banks, HSBC Holdings PLC and Barclays PLC, reported strong investment banking profits on Tuesday and signalled that bad debts may be nearing their peak, raising hopes the worst of the financial crisis is over for them.

The success of HSBC and Barclays in weathering the storm — both rebuffed a government bailout of the banking system — contrasts with their beleaguered taxpayer-supported counterparts including Lloyds Banking Group PLC, which on Tuesday announced plans to shed 5,000 more jobs.

HSBC provided the most upbeat trading update, with Chief Executive Michael Geoghan declaring that "the biggest jolt has now passed through the global economy."

While HSBC's statement lacked details figures, it said that pretax profit for the third quarter was "significantly ahead" of the same period last year and that losses on U.S. consumer loans had shrunk for the first time in three years.

Its global banking and markets division was having a "record year" and commercial banking was "solidly profitable in all regions" over the first nine months, it added.