HSBC (HSBA.UK) is one of the worst performing stocks listed on the London Stock Exchange today after bank reported a massive 81% slump in Q4 pretax profit. However, pretax profit actually increased on the full-year basis.
Q4 2023 results from HSBC have been weakish. Revenue dropped, driven by a big plunge in Wealth & Personal Banking revenue. Drop in operating expenses was much smaller than drop in revenue. Pretax profit of $977 million was over 80% lower than $5.05 billion reported in a year ago quarter. However, this drop came from two one-off items - a $3 billion charge HSBC booked on its holding in China's Bank of Communications, as well as a $2 billion charge the bank took on the sales of its French retail operations.
إبدأ بالإستثمار اليوم أو تدرّب على حساب تجريبي
قم بفتح حساب حقيقي جرب الحساب التجريبي تحميل تطبيق الجوال تحميل تطبيق الجوالFull-2023 results were a slight miss when it comes to total revenue and pretax profit. However, the bank has still managed to significantly increase its sales and profits from 2022, thanks to a positive impact of higher interest rates. HSBC announced that it will purchase own shares worth up to $2 billion and is considering a special dividend of $0.21 per share in the first half of 2024. Dividend payout ratio target was left unchanged at 50% for 2024.
HSBC also said that it expects net interest income of at least $41 billion in 2024, what would mark a drop from $44.1 billion reported for 2023. Bank said it has cautious outlook for loan growth in the first half of 2024.
Q4 2023 earnings
- Revenue: $13.02 billion (-11% YoY)
- Wealth & Personal Banking: $4.36 billion (-36% YoY)
- Commercial Banking: $5.23 billion (+9.3% YoY)
- Global Banking & Markets: $3.73 billion (+12% YoY)
- Operating expenses: $8.65 billion (-1.5% YoY)
- Pretax profit: $977 million (-81% YoY)
- Change in expected credit losses: $1.03 billion
- Net interest margin: 1.52% vs 1.68% a year ago
Full-2023 results
- Revenue: $66.06 billion vs $66.69 billion expected (+31% YoY)
- Wealth & Personal Banking: $27.28 billion (+31% YoY)
- Commercial Banking: $22.87 billion (+40% YoY)
- Global Banking & Markets: $16.11 billion (+10% YoY)
- Pretax profit: $30.35 billion vs $34.12 billion expected (+78% YoY)
- Common Equity Tier 1 ratio: 14.8% vs 14.5% expected (14.2% a year ago)
HSBC (HSBA.UK) is plunging over 7% today after reporting Q4 profit slump and providing a vague outlook for full-2024. Stock plunge from the upper limit of the ongoing trading range in the 6.45 GBP area and is trading around 2% above the lower limit of the range in the 5.825 area. A break below 5.825 support could trigger a share price drop to as low as 5.20 GBP.
Source: xStation5
