- ORIGINAL NEWS
HSBC posts record annual profit but misses estimates on China write-down, shares tumble 7%
- SUMMARY
HSBC, Europe’s largest bank, has reported an impressive rise in pre-tax profits of 78% to $30.3 billion for 2023.
However, this missed some analysts’ expectations of $34 billion.
The bank’s CEO, Noel Quinn, has announced an additional stock buyback of up to $2 billion, bringing the total return to shareholders last year to $19 billion.
HSBC is also considering a special dividend in 2024 after selling its Canadian operations.
However, the bank’s share value declined after reporting a write-down of $3 billion due to its stake in a Chinese bank.
The adjusted profit for the fourth quarter fell by 80%, causing Hong Kong and London share values to drop.
Despite this, HSBC’s revenue for the year increased by 30% to $66.1 billion, with higher lending profitability and stronger capital ratios.
The bank’s strategic focus remains on expanding in Asia and supporting mid-market corporations.
HSBC anticipates a mid-teens return on equity in 2024 and targets banking non-interest income of at least $41 billion.
However, it remains cautious about loan growth prospects in the near term.
- NEWS SENTIMENT CHECK
- Overall sentiment:
positive
Positive
“HSBC pre-tax profit climbed about 78% to $30.3 billion in 2023 from a year earlier.”
“Revenue for 2023 increased by 30% to $66.1 billion, compared with the median LSEG forecast for about $66 billion.”
Negative
“but missed median estimates of $34.06 billion from analysts tracked by LSEG”
“This write-down was among the items that plunged the bank’s fourth-quarter pretax profit by 80% to $1 billion from a year earlier.”