HSBC to keep the highest yield among Greater China region’s banks, JPMorgan analysts say
The 160-year-old bank, which traces its roots to Hong Kong and Shanghai, is likely to return between 9 per cent and 11 per cent to shareholders in 2025, says JPMorgan
The Hong Kong bank’s shares may advance to HK$122 by the end of 2026, JPMorgan said after raising its price target on August 1 from a July 22 revision of HK$118. HSBC’s Hong Kong-listed shares closed 0.7 per cent higher at HK$97 on Wednesday.
The 160-year-old bank, which traces its roots to Hong Kong and Shanghai, was likely to return between 9 per cent and 11 per cent to shareholders this year, the highest yield among banks in the region, said JPMorgan analysts Katherine Lei, Lincoln Yu, Chen Haomin, Kian Abouhossein, Sheel Shah and Benkat Madasu.
It announced a second-quarter dividend of 10 US cents per share and set aside US$3 billion to buy back its own stock over the next three months.
The dividend will not be derailed because HSBC retains a capital buffer by carrying US$14 billion in outstanding threshold deductions, compared to Bocom’s US$21 billion carrying value in the first half of the year. Any further impairment on Bocom below US$14 billion is expected to have a muted impact on HSBC’s capital, dividend payments or share buy-backs, according to JPMorgan.