HSBC unveils US$3 billion stock buy-back after first-quarter profit beats estimates
HSBC says in a worst-case scenario, it could book an additional bad debt provision to guard against a potential global economic slowdown
Net profit fell by 32 per cent to US$6.93 billion, or 39 US cents per share, in the first three months, the London-based banking group said in a Hong Kong stock exchange filing on Tuesday, comfortably beating the US$5.39 billion consensus among analysts tracked by Bloomberg.
The drop in earnings was expected, given the one-off US$3.7 billion net impacts in the same quarter last year from the sale of its banking business in Canada and Argentina.
Pre-tax profit fell 25 per cent to US$9.5 billion, better than the consensus estimate of US$7.83 billion, the bank said. Net interest income fell by 4.6 per cent to US$8.3 billion as lending margin narrowed by four basis points to 1.59 per cent from a year earlier, it said.
“Our strong results this quarter demonstrate momentum in our earnings, discipline in the execution of our strategy and confidence in our ability to deliver our targets,” CEO Georges Elhedery said in the filing. “We continue to support our customers through this period of economic uncertainty and market unpredictability, which we enter from a position of financial strength.”
HSBC’s US$3 billion share buy-back programme will begin after its annual general meeting on May 2. The bank also announced a first-quarter dividend of 10 US cents per share.