What do we not know about HSBC

HSBC exceeds market expectations

In view of the brightening economic situation, HSBC released provisions of $ 435 million in the first quarter, including 288 million in Great Britain. In combination with good business with East Asia's super-rich and in investment banking, this ensured that adjusted pre-tax earnings more than doubled. At 6.39 billion dollars (last year 3.06 billion dollars), it was significantly above the average of analyst estimates of 4.30 billion dollars. "We had a good start to the year in all regions," said CEO Noel Quinn in a conference call with journalists.

He was optimistic about the day-to-day business. "It is still early, but we have taken good momentum into the second quarter." Shareholders could also benefit from this: As the major British bank announced, it will be considering whether an interim dividend should be paid until the half-yearly figures are published in August. Jefferies banking expert Joseph Dickerson also sees “some leeway” for higher performance-related compensation, i.e. bonuses.

However, the costs were higher than expected on the market and the zero interest rate environment ensures that the trend in the net interest margin is pointing downwards. Beyond interest income, Wealth & Personal Banking (WPB) made the largest contributions to earnings growth with + 69% and Global Banking & Markets (GBM) with + 24%, while Global Commercial Banking (CMB) lagged behind with –2%. The collapse of the Archegos Capital hedge fund did not appear to have affected HSBC. "We have no exposure to this situation, either directly or indirectly," said Quinn.