Outgoing HSBC boss paid £6.1m as profits miss City expectations

The outgoing chief executive of Europe's biggest bank has seen his annual pay rise to £6.1m as the bank reported profits that missed analysts' targets.

Stuart Gulliver, who has led HSBC over the last seven years, saw his pay packet rise from £5.7m in 2016 as his annual bonus sharply increased.

The bank, which makes most of its money in Asia, said pre-tax profit more than doubled to $17.2bn ($12.3bn), though that missed analysts' estimates of $19.7bn.

Shares (Berlin: DI6.BE - news) fell 4% in early trading.

Mr Gulliver, who has led the London-listed lender through major restructuring, was handed the higher bonus as he hit latest targets on continuing to sharpen focus and keeping a tight rein on regulatory compliance.

HSBC has been dogged by money laundering claims in recent years - and recently saw the expiry of a "deferred prosecution" agreement under which it was being closely monitored by the US Department of Justice.

Mr Gulliver's remuneration for 2017 included a £3.9m basic salary and a bonus of £2.1m.

Like many large firms with US operations, HSBC had to take an accounting charge in 2017 - in its case $1.3bn - after US President Donald Trump's corporate tax reforms .

But this year's profit was 141% better than the $7.1bn earned the year before, as it did not incur costs from selling its business in Brazil and restructuring one of its European businesses.

The company is busy driving more growth from Asia.

"We concluded the transformation programme that we started in 2015," Mr Gulliver said in a statement.

"HSBC is simpler, stronger, and more secure than it was in 2011. It has been my great privilege to lead HSBC for the last seven years."

HSBC said charges for loans that have gone bad totalled around $500m in 2017, relating "to two large corporate exposures in Europe" though the companies involved were not named.

Lenders' annual results this week are being closely watched for any sign that they may have taken a hit from the collapses of construction and outsourcing giant Carillion (Frankfurt: 924047 - news) .

Mr Gulliver, who has worked for HSBC for 37 years, hands over to John Flint.

Richard Hunter, head of markets at Interactive Investor, said there was disappointment over the lack of a share buy-back scheme to reward the bank's shareholders.

However, he added: "The market may have chosen to concentrate on the less pleasing elements to the numbers, but there is little denying that HSBC is showing signs of being in strong recovery mode."