HSBC Says It Will Buy Back $2 Billion in Stock as Profit Jumps
HSBC Says It Will Buy Back $2 Billion in Stock as Profit Jumps
Zeno Markets 8
Bank reduced provisions for bad loans by $659 million during the third quarter
“While we retain a cautious outlook on the external risk environment, we believe that the lows of recent quarters are behind us,” HSBC Chief Executive Noel Quinn said in a statement. That, along with the group’s “strong capital position,” enabled HSBC to announce a share buyback of up to $2 billion that will commence soon, he added.
HSBC is sharpening its focus on lucrative Asian markets and agreed to sell its French and U.S. retail banking operations earlier this year. It earned a pretax profit of $1.77 billion in Hong Kong, down 6.5% from the third quarter of 2020, due mainly to lower net interest income in the recent period.
Pretax profit from mainland China rose 45% from a year ago to $749 million in the quarter, while that at HSBC’s U.K. bank more than doubled year-over-year to $1.49 billion.
HSBC’s strategic shift to Asia has been hampered by geopolitical tension between China and Western nations. Some U.S. and U.K. politicians rebuked the bank for not publicly criticizing China’s imposition of a new national security law in Hong Kong. Mr. Quinn told U.K. politicians in January that it wasn’t his job as a banker to oppose Chinese policies.
HSBC’s shares have risen about 15% this year, underperforming large London-based banks such as Barclays PLC and Lloyds Banking Group.
The bank last month paid out an interim dividend of $0.07 a share for the first half of 2021. HSBC said Monday that it won’t pay quarterly dividends this year, but will review whether to do so by the time it reports its full-year results in February 2022.
