HSBC spends nearly $300m on UK customer redress

This figure has increased nearly 10 times compared to the first half of last year when the cost of such packages was $33m (about £25m).

As for the group, HSBC’s pre-tax profit in its European operations was $572m. For the same period last year, the profit for Europe was around triple this year’s - at about $1.6bn.

The statement also found that for the first half of 2016 the bank spent $2m on the ongoing review of compliance with the UK Consumer Credit Act. HSBC is yet to post any costs in relation to this for 2017.

As for other regulation, the bank said the creation of the UK ring-fenced bank has been one of the largest projects it has ever undertaken.

The results statement said: “At its peak, the project team numbered more than 2,000 and costs to date amount to approximately half a billion dollars.”

HSBC is targeting July 1 2018 as the deadline to operationalise the UK ring-fenced bank.

As part of this process, HSBC has moved around 170,000 customer sterling accounts to new HSBC UK sort codes. It expects to move all remaining sterling accounts, that require new HSBC UK sort codes, by the end of September 2017.

Douglas Flint, group chairman of HSBC, said caution of customer indebtedness and uncertainties over the EU exit negotiations has resulted in the UK showing signs of slower growth.

The bank’s statement showed it has spent $4m in operating expenses in relation to the UK leaving the EU in the first half of this year.

Flint said the formidable challenge within Europe of negotiating both the terms of the UK’s exit from the EU and the basis of the future relationship will dominate political agendas for some time.