London
Mixed outlook on HSBC: “If there was an award for simple and clean results, then HSBC would get the booby prize,” says Matt Britzman of Hargreaves Lansdown. The Asia-focused bank booked a $3bn impairment on its 19% stake in China’s Bank of Communications in the fourth quarter as well as a $2bn write-down from the sale of its French operation. Profit before tax in the last three months of 2023 fell to $1bn from $5.1bn a year earlier. “Mainland China remains a question mark… [while the] commercial real estate sector [there] continues to be weak.” Return on tangible equity (ROTE) is expected to be in the “mid-teens” this year, with costs and loan-loss levels expected to rise. Even so, HSBC has announced a $2bn share buyback as “a teaser of more to come once the sale of its Canadian business completes”, expected this quarter. “But when it comes to UK banks, the more traditional lenders like NatWest and Lloyds look to be better placed for the upside.”
That view overlooks the success of HSBC’s CEO
