The recent nastiness that has still left millions of people around the globe without work and wiped billions if not trillions off the value of the world’s stock markets was triggered by loss of confidence within the financial sector that threatened an implosion of capitalism as we know it. The world has largely emerged (technically, at least) from the worst recession since the Great Depression and fears still abound that we may yet be in for a second round of contractions. So, it comes as a little of a shock to see pre-tax profits at HSBC, the UK’s biggest bank, at the $11 billion mark.

HSBC was not alone; BNP in Paris reported that its profits were up by a third. The news led to stock market rises in Europe and the US and saw banking stocks close higher. UK bank shares in HSBC, Lloyds and RBS were ahead by 5.26%, 3.88% and 4.28% respectively. BNP put on a healthy 5.3% and Bank of America weighed in with a 2.9% rise. The stock market rally was enough to see a $2 hike on the oil price taking it above the $80 mark on renewed optimism.

HSBC didn’t take any government money during the crisis and reported the money that it had set aside to cover bad loans had fallen to $7.5 billion; the lowest level since the depths of the crisis and something seen as a positive sign by analysts. The bank made profits in all of its business activities except in North America which saw a loss of $80 million. The acid test for the banks, in general, will be there willingness to make new loans to businesses.

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