SHARES in HSBC, the global banking giant chaired by Scot Douglas Flint, closed up 2.3% last night as investors looked past news of further potential mis-selling and conduct problems at the institution to focus on improving growth in its heartlands of the UK and Hong Kong.

The bank also insisted it would do all it could to protect the bank's competitiveness on pay as it claimed the backing of the UK Government and regulators in battling proposed European remuneration rules.

HSBC revealed yesterday that is has aside $149 million (£93m) to cover the costs of a review into investment advice it gave customers of its UK wealth management division after a mystery shopping exercise by regulators.

Most of the sum will cover the costs of the investigation with just $30m to $40m earmarked for compensation as chief executive Stuart Gulliver noted that many of the 20,000 clients affected will have made money.

It said most of the staff in this area have left the bank as, like many other institutions, it has stopped providing this kind of financial advice.

In the third quarter of its financial year, HSBC put aside $428m to cover UK customer compensation including another $147m for payment protection insurance mis-selling and $132m for interest rate protection.

HSBC also disclosed that it had been contacted by the Financial Conduct Authority over possible foreign exchange trading infringements. HSBC said those involved had already left the institution.

Barclays and Royal Bank of Scotland have already disclosed they have been contacted by regulators.

These are just the latest set of conduct problems to hit HSBC. Last year the bank paid $1.9 billion to US regulators to settle a probe into money laundering infringements.

Despite these headwinds, HSBC's pre-tax profit for the three months to the end of September was up 30% to $4.5bn.

Underlying pre-tax profit was up 10% at $5.1bn, compared to the same period last year.

Mr Gulliver said that Hong Kong, which is benefiting from the continuing economic boom in neighbouring mainland China, and the UK provided half of its underlying earnings.

"We are well positioned to benefit from improved economic conditions in both of these markets," Mr Gulliver said.

He reiterated the bank's determination not to be hamstrung in its activities overseas by proposed bonus rules in Europe.

"We intend to take whatever steps are necessary to protect the competitiveness of the HSBC group," Mr Gulliver said.

He said that 74% of HSBC staff that could be caught by the bonus cap worked outside the European Union.

Bank executives have already met with shareholders to discuss possible approaches. HSBC plans to set out its approach in February and seek shareholder backing at its annual meeting.

Mr Gulliver said the bank does not believe the Government risks inflating a housing bubble with a mortgage subsidy scheme Help to Buy south of the Border.

But he added: "I think it possibly could cause some unaffordability issues in certain cities around the UK."

He said loans under the scheme could rise above the worth of the homes they fund if markets move. The bank is testing customers' abilities to stomach steep rises in interest rates.

HSBC's shares closed up 15.7p at 703p.