HSBC Holdings PLC
NII increased 15% Y/Y to $9.2 billion, aided by higher yields on the asset book (mainly in the U.K. and main legal entities in Asia), with net interest margin (NIM) expanding 19bps Y/Y to 1.70%.
Operating expenses rose 2% Y/Y to $8.0 billion due to higher technology costs, higher inflation, and increased performance-related pay accrual.
Profit before tax rose significantly to $7.7 billion for Q3 (vs. analysts' average forecast of $8.1 billion, as per Reuters) from $3.2 billion a year earlier, reflecting the positive impact of a higher interest rate environment.
EPS rose to $0.29 in Q3 from $0.10 in the prior-year quarter.
As of September 30, 2023, loans and advances to customers stood at $935.8 billion.
HSBC reported expected credit losses and other credit impairment charges of $1.1 billion (flat Y/Y).
Common equity tier 1 capital ratio stood at 14.9% in Q3 2023.
Repurchase: The bank further initiated a share buy-back of up to $3 billion, expected to start shortly and complete by FY23 results announcement on February 21, 2024.
"Our Wealth business also gained further traction, attracting $34bn of net new invested assets in the quarter and growing wealth balances by 12% compared with last year," said Noel Quinn, CEO.
Outlook: HSBC reiterated its outlook for 2023 NII at above $35 billion and RoTE in the mid-teens for 2023 and 2024.
HSBC reaffirms its target of paying a special dividend per share of $0.21 from completing the Canadian Banking unit sale in H1 2024. HSBC announced the third interim dividend of $0.10 per share. The dividend of $0.50 per ADS will be payable by the depositary in U.S. dollars.
Price Action: HSBC shares are trading higher by 0.16% at $36.77 premarket on the last check Monday.
