HSBC is sinking after the bank reported an 'unacceptable' 24% decline in profits in its latest earnings

Reuters

HSBC reported a 24% decline in profits in the third quarter.

• HSBC's stock is falling after the bank announced a 24% decline in net profits in the third quarter and now is set to remodel large parts of the firm.
• Acting CEO Noel Quinn said the performance of parts of the bank was "unacceptable."
• The bank's stock was down 4.3% in premarket in New York at 6:00 a.m. and 4.6% in London at 10:00 a.m.
• View Business Insider's homepage for more stories.

On Monday, HSBC released its third-quarter earnings, and now the bank is set for a "remodel", after posting disappointing results.

Net profits in the third quarter were down 24%, according to a statement released by the bank, which added that it was abandoning its main financial target for the year.

The bank's stocks sank 4.3% in premarket as of 6:00 a.m. in New York and 4.6% in London at 10:00 a.m.

Noel Quinn, who is acting chief executive of the bank said that the performance of business activities within continental Europe, the non-ring-fenced bank in the UK, and the US of the bank was "unacceptable."

"Our previous plans are no longer sufficient to improve performance for these businesses, given the softer outlook for revenue growth. We are therefore accelerating plans to remodel them, and move capital into higher growth and return opportunities," Quinn said in the statement.

Quinn did add that Asian business "held up well," as profits in Asia rose 4% before tax, with "a resilient performance in Hong Kong," despite the unrest.

"The revenue environment is more challenging than in the first half of 2019, and the outlook for revenue growth is softer than we anticipated at the half-year," the bank added in its statement. "As a result, we no longer expect to reach our return on tangible equity target of more than 11% in 2020."

Earlier this month, the Financial Times reported that HSBC was cutting up to 10,000 jobs, on top of another 4,700 jobs the bank announced it would cut in August.