This week, HSBC and Standard Chartered banks disclosed share buyback plans.On Wednesday, HSBC Holdings revealed a minor decline in pretax earnings for the 1st half of the year and unveiled a new share repurchase program valued at up to $3 billion.
With a profit of $21.56 billion, the company beat projections despite a 0.4% decrease from the same period last year. The bank, based in Asia but headquartered in London, stated in the second half that it would monitor the US election results and anticipated interest rate reductions.
Group CEO, Noel Quinn mentioned the following in the earnings briefing, “We remain confident that we can deliver attractive returns, even in a lower interest rate environment, as a result of macroeconomic trends that play to our strengths: market-leading businesses connecting high-growth markets that we are continuing to invest in, and ongoing cost discipline.”
In September, Quinn will hand over control to Georges Elhedery. The bank said in a separate statement on Wednesday that Jonathan Bingham, the current global financial controller, will take over as temporary group chief financial officer on September 2 as part of a “process to identify the next permanent” CFO.
The bank reported a $4.8 billion gain from its Canadian banking operations, although this was less than the $1.2 billion impairment loss from the sale of its Argentina division. Operating costs increased by 5% to $16.3 billion as a result of increased investment costs in technology and inflation.
In addition to the $3 billion buyback that was completed in the first quarter, HSBC indicated that the share buyback program will be completed in three months.
Expected credit loss charges were lower in the first half of this year than they were last, at $1.1 billion, partly due to lower charges in mainland China’s commercial real estate sector.
“As we look ahead, the path of interest rates and the outcomes of elections are amongst the factors that will shape the global operating environment,” Quinn said, adding the bank has reduced its sensitivity to interest rates amid growing market expectations for cuts.
“The U.S. election result will be watched particularly closely considering the potential for policy changes based on the result, and the impact this could have beyond its borders.”
A crucial indicator of bank profitability, the net interest margin, fell from 1.7% in the same time of 2023 to 1.62% in the first half of 2022.
During its first-half earnings announcement on Tuesday, Standard Chartered Bank, a peer bank with headquarters in the United Kingdom, also revealed a record-breaking $1.5 billion share buyback program.
Following the announcement, StanChart’s Hong Kong shares saw a slight increase and ended that day at 76.85 Hong Kong dollars.
HSBC shares in Hong Kong rose to HK$68.15 in the early afternoon session following the report.
- Published By Team Genuine Reporter