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HSBC reports fourth-quarter, full-year 2017 earnings

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HSBC’s fortune turned around in 2017 with an increase in the year’s profit.

The bank, largest in Europe by assets, said Tuesday its full-year profit before tax rose 10.9 percent to $20.99 billion after adjusting for foreign currency translation and one-off items. That’s beating the estimated $19.59 billion by Reuters and reversing the decline seen one year ago in 2016.

The bank’s adjusted revenue for 2017 was $51.5 billion, up 5 percent from the previous year.

Analysts had expected higher interest rates to boost HSBC’s lending profitability, resulting in the improved financial performance.

“I think they will have another, not a record, but better-than-expected earnings,” Dickie Wong, executive director of Kingston Securities, told CNBC ahead of the release of the financial report.

The bank’s Hong Kong-listed shares, a heavyweight on the Hang Seng Index, traded 1.26 percent higher at 11 a.m. HK/SIN.

Wong added that HSBC is “in a better shape” compared to other international banks, and investors would be looking for another round of share purchases, though not at the levels previously seen. The bank has bought back $5.5 billion worth of shares from investors since August 2016.

Stuart Gulliver, instrumental in turning around HSBC, will step down as the bank’s chief executive after Tuesday. He will be replaced by HSBC veteran John Flint, who most recently served as the bank’s head of retail banking and wealth management.

HSBC’s latest earnings statement cemented its ability to pick itself up after the global financial crisis. In addition to shifting its focus to Asia, the bank also scaled back some of its operations, including selling its Brazilian business.

“These results and the achievements of the last couple of years give us a great platform to build on,” said Flint in a release that accompanied the earnings announcement.

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Bitcoin (BTC) price slides as US seizes most of Colonial ransom

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A banner with the logo of bitcoin is seen during the crypto-currency conference Bitcoin 2021 Convention at the Mana Convention Center in Miami, Florida, on June 4, 2021.

Marco Bello | AFP | Getty Images

Bitcoin’s price slipped again Tuesday. The reason for the move was unclear, however it may be related to concerns over security of the cryptocurrency after U.S. officials managed to recover most of the ransom paid to hackers that targeted Colonial Pipeline.

Court documents said investigators were able to access the password for one of the hackers’ bitcoin wallets. The money was recovered by a recently launched task force in Washington created as part of the government’s response to a rise in cyberattacks.

The world’s largest cryptocurrency slid over 7% at 5 a.m. ET to a price of $32,952, according to Coin Metrics data. Smaller digital coins also slumped, with ether falling 7% to $2,524 and XRP losing around 6%.

In April, 2021 was looking to be a banner year for digital assets, with bitcoin having topped $60,000 for the first time ever. But a recent plunge in crypto prices has shaken confidence in the market. Bitcoin sank to nearly $30,000 last month, and is currently down almost 50% from its all-time high.

The digital currency is now up only 14% since the start of the year, though it’s still more than tripled in price from a year ago.

U.S. recovers most of Colonial ransom

On Monday, U.S. law enforcement officials said they had seized $2.3 million in bitcoin paid to DarkSide, the cybercriminal gang behind a crippling cyberattack on Colonial Pipeline.

According to a court document, the Federal Bureau of Investigation was able to access the “private key,” or password, for one of the hackers’ bitcoin wallets. Bitcoin has often been the currency of choice for hackers demanding ransom payments to decrypt data locked by malware known as “ransomware.”

Crypto media outlet Decrypt reported there were unfounded rumors that the attackers’ bitcoin wallet had been “hacked,” an unlikely scenario.

DarkSide, which reportedly received $90 million in bitcoin ransom payments before shutting down, operated a so-called “ransomware as a service” business model, where hackers develop and market ransomware tools and sell them to affiliates who then carry out attacks.

According to blockchain analytics firm Elliptic, the seized funds represented the bulk of the DarkSide affiliate’s share of the ransom paid out by Colonial.

John Hultquist, vice president of analysis at Mandiant Threat Intelligence, called the move a “welcome development.”

“It has become clear that we need to use several tools to stem the tide of this serious problem, and even law enforcement agencies need to broaden their approach beyond building cases against criminals who may be beyond the grasp of the law,” said Hultquist.

“In addition to the immediate benefits of this approach, a stronger focus on disruption may disincentivize this behavior, which is growing in a vicious cycle,” he added.

Crypto crackdown

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Alibaba expands cloud products with livestream shopping in its battle against Amazon

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Alibaba trails Amazon and Microsoft in the global cloud computing market and hopes new products such as livestreaming e-commerce can help it stand out.

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Industry has to remain competitive as it goes green: RWE Krebber

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Electricity pylons and wind turbines stand beside the RWE Niederaussem coal-fired power plant while Steam rises from cooling towers on February 16, 2016 near Bergheim, Germany.

Volker Hartmann | Getty Images News | Getty Images

A transition to greener industry has become a priority in Europe but the head of a major German energy producer said there needs to be a “level playing field” so the region’s companies can compete globally.

“What we need is a global level playing field,” Markus Krebber, chief executive of RWE, the biggest producer of energy in Germany, told CNBC on Monday. “[Otherwise] it will be very difficult to compete with CO2-intensive imports when you are forced, in Europe, to decarbonize your industries.”

“It needs to be clear that, whatever politicians come up with [in terms of] a regulatory framework, we need to keep that level playing field otherwise we risk not only losing jobs but also risk losing the acceptance of our societies,” he added.

Germany’s government has recently increased its carbon emission cutting targets, with Chancellor Angela Merkel’s cabinet approving draft legislation in May that aims to see carbon emissions cut by 65% from 1990 levels by 2030. The country is also aiming to be carbon neutral by 2045.

Germany’s emission levels are already 40% lower than they were in 1990, according to the country’s environment minister.

The more ambitious government targets have been set amid an upswing in support for Germany’s Green Party, which polls suggest is likely to become a partner in a coalition government following a federal election in September.

RWE’s Krebber said that, in the long-term, he was not concerned by government policies aiming at “greening” industry because the public supported the transition.

“If it’s wanted by the consumer and he pays for it you don’t need a support scheme, you just need a regulatory framework. But that will not happen overnight,” he noted.

“So I think that, in the beginning, we need support. But I would really urge everybody to think about market-based systems and not direct subsidies, which are not based on a competitive process, because we cannot risk to implement very expensive technologies in Germany. We currently have the highest power prices across Europe.”

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