HSBC bank has set a new European record for half-year earnings after recording profits of more than £325 a second.

The banking group saw profits rise 53 per cent to £5.14bn in the first six months of the year.

The improvement, which was ahead of market expectations, reflects a full contribution from Household, the US consumer finance operation it acquired last year.

In Europe, where HSBC generates about a third of its earnings, profits before exceptional items were £1.68bn for the half year.

Sir John Bond, group chairman, described the figures as a solid performance, reflecting revenue growth and disciplined cost-management.

Sir John said the environment remained favourable: "Although trading conditions in our global markets business in the second quarter were less buoyant than in the first, there are no obvious signs of significant deterioration."

Michael Geoghegan, chief executive of the UK business, declined to comment on speculation that HSBC may make a bid for Abbey National.

The figures come two months after HSBC said it was cutting 3,000 jobs as part of a drive to improve efficiency and streamline its product range. It also said it would recruit an additional 1,000 staff.

The bank has more than 110 million customers served by 9,500 offices in 79 countries and territories. It employs 40,000 people in the UK and has 1,587 branches.