HSBC's shares received a battering on new chief executive Stuart Gulliver's first annual results announcement, as the bank admitted shareholders returns would fall as it meets the cost of strict new regulations.
The bank said it would crimp its long-held return on equity targets to cater for the 'Basel 3' rules, which from 2013 will force banks to set more capital aside for future crises.
HSBC also revealed its costs had ballooned partly because it is increasing staff wages in Asia, and that it could take a significant hit this year from a new tax the British government plans to levy on bank bonuses.
The shares had plunged 5 per cent to 674.2 pence by mid-afternoon in trading in London.
HSBC earned money in all its major markets last year and pre-tax profit more than doubled to US$19 billion, largely because bad loan charges in its troubled North American subprime lending unit fell sharply.
Net income more than doubled to US$13.2 billion from US$5.83 billion the previous year.
