HSBC - HSBC Holdings plc
| Previous Close | 38.74 |
| Open | 39.13 |
| Bid | 39.18 x 3000 |
| Ask | 39.23 x 1000 |
| Day's Range | 39.10 - 39.29 |
| 52 Week Range | 35.35 - 45.33 |
| Volume | 2,602,054 |
| Avg. Volume | 2,484,100 |
| Market Cap | 157.366B |
| Beta (3Y Monthly) | 0.61 |
| PE Ratio (TTM) | 11.33 |
| EPS (TTM) | 3.45 |
| Earnings Date | N/A |
| Forward Dividend & Yield | 2.00 (5.16%) |
| Ex-Dividend Date | 2019-08-15 |
| 1y Target Est | 42.81 |
- Moody's
HSBC Bank Middle East Limited (UAE Branch) -- Moody's announces completion of a periodic review of ratings of HSBC Bank Middle East Limited
Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of HSBC Bank Middle East Limited and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future.
- Reuters
British banks seek tweaks to accountability rules
Britain's new system of banker accountability has led to a "tangible" improvement in culture but modest changes are still needed, UK Finance said on Tuesday. The trade body for banks in Britain published the sector's first major appraisal of the senior managers and certification regime (SMCR) introduced in 2016 as part of reforms implemented after the 2007-09 financial crisis that left taxpayers to bail out lenders while few individual bankers faced punishment. SMCR makes it easier for regulators to pinpoint blame when things go wrong.
- Reuters
Saudi Aramco pursues IPO with local listing plan as lines up banks: sources
DUBAI/LONDON (Reuters) - Saudi Arabia plans a gradual listing of Aramco on its domestic market, sources familiar with the matter said on Monday, as it finalises the roles banks will play in the initial public offering (IPO) of the world's biggest oil company. The kingdom intends to list 1% of the state oil giant on the Riyadh stock exchange before the end of this year and another 1% in 2020, the sources said, as initial steps ahead of a public sale of around 5% of Aramco. Based on the indicated $2 trillion valuation that Saudi Aramco had hoped to achieve, a 1% float would be worth $20 billion, a huge milestone for the local stock market.
- Investopedia
U.S. Banks Dominate After 2008 Crisis Amid Uncertain Growth Outlook
The biggest U.S. banks have grown bigger since the 2008 financial crisis, and now analysts are downgrading their stocks as recessionary fears rise.
- Bloomberg
Beware Banks Dipping Into This Murky Trade
(Bloomberg Opinion) -- A type of financial engineering that proved to be toxic during the financial crisis is slowly making a comeback as banks try to offset the risk of their borrowers not repaying their loans.Capital relief trades, or synthetic deals, are making a comeback — and Europe is about to refine the rules of the game. Getting those right will be crucial if we are to avoid a repeat of history.The products all have one thing in common: They provide a cosmetic improvement to a lender’s balance sheet. They shunt the risk of a borrower defaulting away from the lender to other players in the financial system — in much the same way that loans were securitized, or sliced up and sold, before the financial crisis.But these aren’t true disposals. Banks are, in effect, only taking out insurance against the risk of future losses by using derivatives. The actual loan remains on the books of the original bank — and the insurance allows the lender to reduce the amount of its own capital it has to set aside to cover the risk that the borrower defaults.The incentives for both buyers and sellers of credit protection are becoming more compelling than ever. On one hand, European banks are still struggling to get their capital buffers to the levels required of them, a goal that is being complicated by the ongoing squeeze negative interest rates are putting on profits.On the other hand, yield-hungry investors — from hedge funds to insurers — are only too keen to pick up some juicy returns in the era of, wait for it, negative interest rates.The deals aren’t cheap. They tend to yield more than Additional Tier 1 bonds, which can be converted into shares if a bank’s capital ratio falls below a certain level.But they do allow lenders to release a fair amount of equity without attracting public scrutiny. That’s just as well: With their valuations near record lows, banks would prefer not to raise fresh funds on the stock market.What is far from clear is the extent to which synthetic transactions actually transfer risk given their complexity. In deals that aren’t funded, or collateralized, the buyer of the protection (the lender) remains exposed to the risk that the counterparty may not be able to make good on the pledge to cover credit losses.Add to the mix a lack of transparency about where the risk is moving to in the financial system — the sellers of the protection tend to be more loosely regulated — and it will come as no surprise that watchdogs in the U.K. and the U.S. discourage these trades.Because most of the deals tend to be private, bilateral agreements between banks and investors, data on the breadth and depth of the market is sketchy. Anecdotally, those active in this pocket of structured finance say that there has been a steady pickup in business over recent years. The market may have seen as much as 25 billion euros ($28 billion) of protection being sold, insuring portfolios of as much as 350 billion euros, according to data compiled by Structured Credit Investor.Banks that have used risk-transfer trades include big lenders like HSBC Holdings Plc, Deutsche Bank AG and Banco Santander SA. But new European Union rules that came into effect this year are also attracting smaller firms to the market: Banca Popolare di Bari SCpA, an Italian lender whose capital is below minimum requirements, struck a deal with a hedge fund in July to provide capital relief on a 3 billion-euro portfolio of loans. The deal improved its common equity Tier 1 ratio by 100 basis points.The new rules allow banks using standardized risk models, as opposed to their own internal risk models, to gain capital relief from synthetic deals. And more regulatory changes are on the way.The European Banking Authority is preparing a consultation this month that could pave the way for synthetic deals to be granted the “simple, transparent and standardized” label that securitizations enjoy. This EU-wide seal of approval is designed to attract more investors willing to fund these deals. The EBA may also decide to apply that label to derivatives that are fully-funded with high quality collateral. That requirement cuts the risk that individual investors are stretching themselves beyond their means and may not be able to deliver on their commitments. The EBA may also push for more transparency, requiring parties to report trades to ESMA, the European securities watchdog.This is all a step in the right direction — but expect some pushback from big finance. Over the last year, insurers in particular have been getting into the market, and they don’t like the idea of posting collateral, much like they don’t when underwriting other risks. No doubt, if done right, synthetic securitizations should be part of the financial industry’s instruments. But regulators will need to ensure participants are exercising due prudence. More stringent rules on funding and transparency would go a long way to ensuring that.To contact the author of this story: Elisa Martinuzzi at emartinuzzi@bloomberg.netTo contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Zacks
UBS Group Contemplates Investment Bank Unit Restructuring
UBS Group (UBS) to revamp the company's investment banking unit, in a bid to improve its performance and trim costs.
- Bloomberg
Boris Johnson ‘Would Rather Be Dead’ Than Delay Split: Brexit Update
(Bloomberg) -- Follow @Brexit, sign up to our Brexit Bulletin, and tell us your Brexit story. Boris Johnson’s six-week-old premiership was thrown into yet more disarray after his brother quit the government in protest at his Brexit strategy. After three days of humiliation, the beleaguered prime minister launched a fightback in a speech in northern England, appealing directly to the public for an election to resolve Britain’s political crisis. He said he would “rather be dead in a ditch” than ask the European Union to delay Brexit again.Key Developments:Minister Jo Johnson resigns, citing tension between “family loyalty and the “national interest”Johnson making appeal for election Prime Minister will try again to persuade MPs to trigger an early general election on MondayHouse of Lords debating bill to block no-deal Brexit until FridaySplits appear in cabinet over Johnson’s tacticsThe pound rose 0.6%U.K. Said to Want to Unpick Deal (6:05 p.m.)Boris Johnson wants to remove several parts of the deal that was struck between the U.K. and EU in November, according to an official briefed on Wednesday’s negotiations in Brussels.David Frost, Johnson’s envoy, told the European Commission the U.K. wants to:Remove many articles of the contentious Irish border “backstop,” leaving only provisions on citizens’ rights, the common travel area and single electricity market on the island of Ireland. He didn’t say what the U.K. wanted in its place.Take out references in the political declaration on the future relationship to the “level playing field” which would keep the U.K. aligned to many of the EU’s standards. The EU says this is necessary for an ambitious free-trade agreementChange the way the agreement would be governed to take out references to the European Court of Justice. The EU said this would affect future police and judicial cooperation.Johnson Doubles Down on Push for Oct. 15 Election (6 p.m.)Boris Johnson pledged to hold a general election on Oct. 15, or even earlier, if opposition Labour Party leader Jeremy Corbyn wants that. The prime minister was responding to a question about whether he can be trusted not to shift the date of an election in order to take the U.K. out of the EU without a deal.“We want an election on October 15 and indeed earlier if he wants: :Let’s crack on with it,” Johnson said. “If he wants to avoid a no-deal Brexit, or if he wants to avoid a hard Brexit then he should believe in himself to go to Brussels on Oct. 17 to that crucial summit and sort it out.”The premier said the current situation is unsustainable. “I really don’t see how you can have a situation in which the British ability to negotiate is absolutely torpedoed by Parliament in this way, with powers of the British people handed over to Brussels so that we can be kept incarcerated in the EU without that actually being put to the people in the form of a vote,” he said.Johnson Glosses Over Split With Brother (5:35 p.m.)Johnson was asked about his brother Jo’s decision to quit the government earlier in the day, citing a conflict between family loyalties and the national interest (see 11:30 a.m.). He glossed over questions about whether he was acting in the national interest and said “people disagree about the EU.”“Jo doesn’t agree with me about the EU because it’s an issue obviously that divides families, that divides everybody,” said Johnson, before noting that his brother supports his wider agenda for the country.The premier also said he’d spoken to his brother earlier in the day, and praised his service as a minister for science and universities.Johnson: ‘Rather be Dead’ Than Delay Brexit (5:30 p.m.)Johnson said he would “rather be dead in a ditch” than ask for a delay in Brexit beyond Oct. 31.Answering questions after a speech in northern England, Johnson said he guaranteed that he wouldn’t ask for an extension from the EU while he is prime minister. But he dodged the question when he was asked if this meant he would resign rather than sign up to another delay.Johnson Makes Plea For Election (5:18 p.m.)Johnson is making a speech at a police academy in the north of England in which he is expected to make a plea for a general election.He will also reassert his pledge to recruit 20,000 police officers and trumpet his commitment to law and order as he gets a head start in the campaign for votes.But on a stage with dozens of police officers, his surroundings may be a gift to opponents who have accused him of staging a “coup” by suspending Parliament -- and to sketch writers likely to suggest he’s taking his commitment to “taking back control” to a new level.Johnson to Meet Varadkar on Monday (4:45 p.m.)Prime Minister Boris Johnson will travel to Dublin early on Monday to meet his Irish counterpart Leo Varadkar. He’ll return to London in time to be in the House of Commons for the key vote on a general election in the evening, his spokeswoman, Alison Donnelly, told reporters.U.K. Offers Banks $1.6b to Guarantee Brexit Loans (3:45 p.m.)Business Secretary Andrea Leadsom and other senior ministers met with lenders including HSBC, Lloyds and Barclays on Thursday to encourage them to support small and medium-sized companies through Brexit.The state-backed British Business Bank has 1.3 billion pounds ($1.6 billion) available to help banks lend money to businesses that need it, the Business Department said in an emailed statement. “Lenders must empower their SME customers to seize the huge variety of opportunities that lie ahead as we leave the EU on October 3,” Leadsom said.Leadsom was joined in the meeting by Michael Gove, the cabinet minister in charge of no-deal Brexit preparations, Economic Secretary to the Treasury John Glen and Small Business Minister Kelly Tolhurst. Other lenders included Bibby Financial Services, Virgin Money, Metro Bank, RBS, Santander and TSB.Johnson Calls Corbyn ‘Chlorinated Chicken’ Again (1:15 p.m.)Boris Johnson met U.S. Vice President Mike Pence in Downing Street, and used the opportunity -- while talking about a future free-trade deal -- to make the same joke as Wednesday when he called opposition Labour leader Jeremy Corbyn a chicken because he didn’t vote for an early general election .“We will make sure we do everything we can to increase free trade,’’ Johnson told Pence. “The National Health Service is not on the table as far as our negotiations go -- we’re not too keen on that chlorinated chicken either. We have a gigantic chlorinated chicken already here on the opposition bench.”Pence said the U.S. is “ready, willing and able” to offer the U.K. a trade deal.No-Deal Bill to Get Rapid Royal Assent (1:15 p.m.)Leader of the House of Commons Jacob Rees-Mogg said that the bill passed by MPs last night blocking a no-deal Brexit will get royal assent -- come into law -- “speedily” once it is debated for the final time in the Commons on Monday. The bill is currently in the House of Lords, and is due to return to the Commons, potentially with amendments, by Friday evening.Gove Sees Johnson Resignation as Unlikely (1:05 p.m.)Michael Gove, the Cabinet minister in charge of no-deal planning, is still speaking to the House of Commons committee on Brexit. Asked whether Boris Johnson would resign rather than ask for another delay, he said: “I don’t think the prime minister has any intention of resigning.”Under legislation working its way through Parliament, Johnson would be compelled to seek a delay to Brexit if by Oct. 19 he’s failed to secure a new Brexit deal or persuade MPs to back a departure without a deal. The premier said in reaction: “I refuse to do this.” Instead, he wants a general election before then -- but MPs refused to vote for one.That means if Johnson fails to secure an election, on Oct. 19 he’d be faced with the conundrum of either writing the letter or disobeying the law.Berger: Not Clear Where She’ll Stand for Lib Dems (1 p.m.)Luciana Berger, who joined the Liberal Democrats as an MP Thursday, said it was not yet clear if she will stand in the district of Liverpool Wavertree at the next election because of the party’s localized decision-making structure. It’s “not a decision for me,’’ she told Sky News. “I’d like to remain making a contribution to public life.’’Berger quit the Labour Party in February citing anti-Semitic bullying. She has remained as an independent candidate until today. The Liverpool Wavertree district has a strong Labour history and the Liberal Democrats have already selected a candidate for the area.MPs Will Vote Again on Early Election (12:50 p.m.)Leader of the House of Commons Jacob Rees-Mogg laid out a list of motions that will be debated in the House of Commons on Monday, culminating in a “motion relating to an early parliamentary general election.”It will be a second attempt by the government to force an early general election -- the next one currently isn’t due until 2022. Late on Wednesday, Johnson tried and failed to secure the 434 votes he needs -- two thirds of the House of Commons -- to call a ballot.Opposition parties declined to approve of an election because they want a bill to pass into law that would stave off a no-deal Brexit on Oct. 31. By Monday, that bill is likely to have passed into law, and the government’s calculation is that opposition parties may then swing behind his demand for a fresh election.Rees-Mogg also said that all bills needed for the U.K. to leave the European Union are in place.Gove Says New Brexit Deal Can Be Secured (12:35 p.m.)Cabinet Office Minister Michael Gove, who’s in charge of no-deal Brexit preparations, said the changes to the Brexit agreement being sought by Johnson are “eminently achievable.’’He said that while he would support former Prime Minister Theresa May’s deal if it came back to the house of Commons for another vote, the changes Johnson is seeking would mark a “material improvement” in the deal. They are to strip out the Irish backstop, and alter the political declaration to make clear Britain would be outside the customs union and single market. He also said the U.K. wants a free-trade agreement with the bloc.Gove was giving evidence to the House of Commons Exiting the European Union Committee. He earlier said that the Operation Yellowhammer document spelling out the potential impact of a no-deal exit that was leaked to the Sunday Times last month represented a “reasonable worst-case scenario,” and not a base-case prediction. He said there was no evidence to suggest former Chancellor of the Exchequer Philip Hammond could have been behind the leak.Business Secretary to Meet With Banks (11:40 a.m.)Business Secretary Andrea Leadsom will meet later Thursday with executives from the country’s main banks to discuss their support for small and medium-sized companies through Brexit, Prime Minister Boris Johnson’s spokesman, James Slack, told reporters in London.Johnson Wants Election Before Oct. 17 EU Council (11:35 a.m.)Prime Minister Boris Johnson will say in a speech this afternoon that he wants an election before the EU council meeting on Oct. 17, his spokesman James Slack said.“The prime minister believes we should have the election before the EU council and asks MPs to reflect on the sustainability of their position,’’ Slack told reporters. “Having chosen to introduce a bill that destroys our negotiating position,’’ he said, politicians “ must take responsibility for their actions.”Johnson’s Brother Quits Over Strategy (11:30 a.m.)Boris Johnson’s own brother, Jo Johnson, said he’s quitting the government and his seat in Parliament because of differences with the prime minister.“In recent weeks I’ve been torn between family loyalty and the national interest,” Jo Johnson said on Twitter. “It’s an unresolvable tension & time for others to take on my roles as MP & Minister. overandout.”The departure is a severe blow to the prime minister at a time when he’s alienated the moderate wing of his party by expelling 21 MPs on Tuesday because they voted against the government in order to stave off the risk of a no-deal Brexit on Oct. 31.Jo Johnson is a longstanding pro-European -- and had quit as a minister under former Prime Minister Theresa May because he believed the country needed a second referendum on Brexit. It raised eyebrows when he agreed to serve in his brother’s government -- because the premier was the figurehead of the Leave campaign in the 2016 referendum.Former Labour MP Berger Joins Liberal Democrats (11 a.m.)While Johnson has been expelling MPs from his party, Parliament’s fourth party, the Liberal Democrats keep growing. Luciana Berger, who quit Labour earlier in the year, said on Thursday she’s joined the Liberal Democrats.It’s the party’s second addition of the week, after Philip Lee’s defection from the Conservatives on Tuesday deprived Johnson of his majority. They now have 16 MPs.Javid Hopes Rebels Can Return (9:30 a.m.)Chancellor of the Exchequer Sajid Javid said he wants the 21 rebels expelled from the Conservative Party on Tuesday to be reinstated, though he also added Johnson had “no choice” but to fire them.Javid’s comments follow reports of an argument in cabinet this week in which a group of senior ministers, led by no-deal Brexit minister Michael Gove, demanded that Johnson should give the rebels a way back into the party. The prime minister refused.“I would like to see those colleagues come back at some point,” Javid told LBC radio. “They are not just my colleagues; these are my friends, they are good Conservatives.”Javid said it was right for Johnson to make Tuesday’s vote -- allowing Parliament to seize the legislative timetable in order to block a no-deal Brexit -- a matter of confidence in the government. Those who voted against it knew the “consequences,” he said.Swinson Wants Extension Before Election (9 a.m.)Liberal Democrat Leader Jo Swinson said she wants a general election only after an extension to Brexit has been agreed with Brussels.She said she believes Johnson wants an election before his exit deadline of Oct. 31 so he can take the U.K. out of the EU without a deal and blame Brussels for the failure to get an agreement.“He’s frightened of being found out,” she told Sky News. “He’s got an opportunity to go and get that great deal he said he could get and get it past Parliament, but he’s frightened to do that.”Caroline Nokes, one of the MPs expelled from the Tory Party on Tuesday, also said Johnson shouldn’t rush a national vote. “It’s really cynical to try to force through an election,” she said. “The tool we need in Parliament is time.”Labour ‘Consulting’ on Election Timing (Earlier)Labour Treasury Spokesman John McDonnell said the party is consulting with its own MPs and other parties over the best timing for a general election.While some want a national vote once a law against a no-deal Brexit is enacted, others want to wait until after a further delay to Jan. 31 has been secured before going to the country. None of the opposition parties have any confidence that Johnson will keep to his word, he said in media interviews on Thursday morning.“We have to be the adults in the room,” McDonnell said, after comparing Johnson to a toddler having a tantrum. Labour wants to keep “as much control as we possibly over the date of that election,” he told Sky News.Earlier:Johnson Boxed In Over Brexit as Bill Is Pushed Through LordsPound Rally Stalls After Lawmakers Reject Johnson’s Brexit PlansBrussels Edition: No Deal for Boris\--With assistance from Justin Sink, Ian Wishart and Thomas Penny.To contact the reporters on this story: Alex Morales in London at amorales2@bloomberg.net;Kitty Donaldson in London at kdonaldson1@bloomberg.net;Jessica Shankleman in Wakefield at jshankleman@bloomberg.netTo contact the editors responsible for this story: Tim Ross at tross54@bloomberg.net, Stuart Biggs, Mark WilliamsFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
Saverin-Backed Health Startup Seeks Funds at $250 Million Value
(Bloomberg) -- CXA Group, a Singapore-based health service backed by Facebook co-founder Eduardo Saverin, is again hitting up investors. Founder Rosaline Chow Koo said her startup intends to start a new round of funding to try and raise at least $50 million at a $250 million valuation.The goal is still for CXA to achieve profitability mid- to late next year and unicorn status -- or a valuation of $1 billion or more -- within three years, Koo told Bloomberg’s Sooner Than You Think conference in Singapore. The company is seeking funding in the wake of securing long-term contracts with insurers and other customers, she added.“We have to go for another funding round,” she told the conference on Thursday. “We’re going back out only because we’ve signed very long-term contracts to actually be white-labeled by these firms globally.”CXA is the brainchild of Koo, a female entrepreneur who grew up poor in Los Angeles and started the business in 2013 as a personalized employee health and wellness benefits platform. The company now serves more than 600 companies and more than 400,000 employees in 20 countries.Revenue increased 65% in 2018 and is expected to double in 2019, Koo has said previously. In March, CXA raised $25 million by selling convertible debt to investors including HSBC Holdings Plc, Singtel Innov8 and Telkom Indonesia MDI Ventures. Prior to that, the startup had raised $33 million from two previous financing rounds.People in Asia are getting hit with chronic diseases earlier than in the West so they need flexibility in how they manage health-care costs, Koo has said. Her company allows employees to shift their traditional insurance money -- typically used for illness, injuries or death -- to combat these chronic diseases or to get mentally or physically healthier.CXA then tailors benefits to each individual’s life stage by using machine learning technology. The employees can use their e-wallet in the mobile app to select service providers and spend their allowance instead of getting one-size-fits-all benefits.Read more: First-Time Female Founder Nabs $25 Million to Expand Health Site(Updates with Koo’s comments from the third paragraph.)To contact the reporters on this story: Yongchang Chin in Singapore at ychin22@bloomberg.net;Yoolim Lee in Singapore at yoolim@bloomberg.net;Derek Wallbank in Singapore at dwallbank@bloomberg.netTo contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Edwin Chan, Colum MurphyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Moody's
HSBC Mexico, S.A. -- Moody's rates A3 and Aaa.mx HSBC México's certificados bursátiles; negative outlook
In the first and second paragraph of the press release, the ticker for the fourth issuance of Certificados Bursátiles Bancarios was corrected to HSBC 19-2D. In the List of Affected Ratings, the ticker for the fourth issuance of Certificados Bursátiles Bancarios was corrected to HSBC 19-2D. Mexico, August 29, 2019 -- Moody's de México ("Moody's") assigned A3 and Aaa.mx long-term global and Mexican National Scale senior unsecured debt ratings to HSBC México, S.A., Institución de Banca Múltiple, Grupo Financiero HSBC's (HSBC México) proposed third (HSBC 19-2) and fourth (HSBC 19-2D) issuances of Certificados Bursátiles Bancarios.
- Benzinga
HSBC Leverages Voltron Trade Finance Platform To Further Joint BNP Paribas, Standard Chartered Blockchain Efforts
HSBC completed its first yuan-denominated blockchain letter of credit transaction, according to a Sept. 2 Reuters report, taking a step forward in its use of the Voltron platform, developed jointly with other large financial institutions. “The exchange of the electronic documents was completed in 24 hours, compared to the typical five to 10 days for conventional document exchange,” an HSBC representative told Reuters. “We are hoping that we will have something by end of the year, maybe the first quarter of next year," said Ajay Sharma, HSBC regional head of global trade and receivables finance in the Asia-Pacific.
- Bloomberg
Big Bank Headcounts Aren’t Budging Despite Dramatic Job Cuts
(Bloomberg) -- Pockets of job growth are offsetting some of the dramatic cuts at the world’s largest lenders.Bank of America Corp., Wells Fargo & Co., HSBC Holdings Plc and Credit Suisse Group AG added some 12,000 jobs in the first half of the year, according to data compiled by Bloomberg, meaning aggregate staff levels at 16 of the largest U.S. and European lenders haven’t budged even amid the high-profile slashing.Headcount is holding steady as firms including JPMorgan Chase & Co. and Charlotte, North Carolina-based Bank of America open hundreds of branches in new cities and states across the U.S., reversing a decade-long stretch of reductions. Meanwhile, the battle for technology talent continues to create demand for new positions. And even those firms that are cutting also have to beef up in areas such as compliance.Bank stocks have trailed broader markets across Europe and the U.S. amid concerns about declining and even negative interest rates and sluggish capital markets. That’s led executives even at firms that are boosting profits to strike an austere tone in an effort to show investors that they’re reining in costs. In contrast to many industries, banks are making cuts loudly and hiring with little fanfare.Barclays Plc said it eliminated 3,000 jobs in the second quarter, yet its total headcount is down by only 1,500 this year. The British bank has been ditching retail units around the world while focusing more on investment banking, where it has said it’s hiring.After reducing staff by a total of 800,000 people following the 2008 crisis, some of the largest banks resumed hiring in recent years as business stabilized and they seized market share from rivals. Still, the mix has shifted toward lower-paid staff while traders and investment bankers have seen their ranks -- and their pay -- shrink in the past decade.And the pain at some firms is just getting started. The job-cut announcements in the past few months have come mostly from European banks, some of which have yet to finish restructuring.Deutsche Bank AG, which has pledged to eliminate 18,000 positions in the next three years, has cut only about 900 so far this year. The German bank, which is notoriously slow in realizing its job-cutting targets, is just 11% below its peak staff level in 2010, while some rivals have cut theirs by more than half.HSBC’s staff rose by 2,500 in the first half of the year as it added in areas including information technology, wealth management and retail and digital banking. The firm said last month it would ax more than 4,000 positions, with a focus on senior executives.“We’re not cutting costs, but managing costs, so they grow slower than the growth in revenues,” HSBC spokesman Robert Sherman said.To contact the reporter on this story: Yalman Onaran in New York at yonaran@bloomberg.netTo contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Daniel TaubFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Reuters
HSBC processes first blockchain letter of credit using Chinese yuan
HSBC completed the first yuan-denominated blockchain-based letter of credit transaction, the bank said on Tuesday. HSBC, like many of its competitors, has been looking to use digital ledger technology, or blockchain, to streamline the traditionally paper-based and bureaucratic business of financing trade. As the first such transaction to use the Chinese currency, this deal marks a step forward in the use of the Voltron trade finance platform, developed by eight banks including BNP Paribas, and Standard Chartered as well as HSBC.
- South China Morning Post
Cantonese opera features on new HK$100 banknotes launched by HSBC, Standard Chartered and Bank of China (Hong Kong) on Tuesday
The time-honoured traditions of Cantonese opera form the backdrop of a brand new set of HK$100 notes to be launched in Hong Kong on Tuesday.The city's note-issuing banks, HSBC, Standard Chartered and Bank of China (Hong Kong), have come up with their own designs to capture the spirit of the hugely popular ancient art form on the new-look banknotes.The notes, available at bank branches from Tuesday, bear characters and scenes evoking the celebrated musical stage shows, including a princess in a Chinese wedding gown and young lovers in a garden.Bank of China (Hong Kong)'s design features a single beautiful young lady in traditional opera costume. Photo: K. Y. Cheng alt=Bank of China (Hong Kong)'s design features a single beautiful young lady in traditional opera costume. Photo: K. Y. Cheng"Among the current series of banknote designs, I particularly like the HK$100 banknote because it features the Cantonese opera, which is a very traditional Hong Kong culture and popular performing art," said Norman Chan Tak-lam, chief executive of the Hong Kong Monetary Authority.In Hong Kong, it is the de facto central bank that decides security features of paper currency, but the three note-issuing banks came up with the designs.Chan hosted a launch ceremony for the new HK$100 banknotes, attended by the chief executives of the three lenders, at the Xiqu Centre in West Kowloon Centre. It featured a 20-minute live performance of Cantonese opera by local young artists.Romance featured heavily in the designs of the new banknotes.HSBC's note shows a couple of young lovers meeting in a Chinese garden, while Standard Chartered opted for a princess in a Chinese wedding gown with her new husband. BOCHK kept it simple, with a single beautiful young lady in traditional opera costume."Love stories are an important theme of many Cantonese operas, which is why we chose the young lovers as our theme," said Diana Cesar, chief executive of the Hong Kong office of HSBC, at the ceremony. Dispelling 5 common misconceptions about Cantonese opera"Cantonese opera continues to thrive in Hong Kong, attracting young people to learn and appreciate the art. This theme, beautifully captured in watercolour before being converted into engravings, expresses HSBC's connection with the Hong Kong community and our shared heritage."Standard Chartered's princess and husband are based on two young Hong Kong artists, according to Mary Huen Wai-yi, the bank's local chief executive."We want to show the spirit of the young artists. The show must go on, and we need young artists to continue the show," said Huen.BOCHK chose to focus on a single young lady as it wanted to show her beauty, said Yu Xin, senior art director of China Banknote Printing & Minting Corporation, who designed many of the bank's themed notes.The designer said the current banknotes have more security features than the ones in 2010.To celebrate its new HK$100 note, HSBC is launching an augmented reality filter in which the user's "selfie" photo taken on a smartphone is turned into a Cantonese Opera character.Cantonese opera was listed as an intangible cultural heritage of humanity by Unesco in 2009."This year marks the 10th anniversary of the Unesco inscription of Cantonese opera, making the launch of this banknote all the more meaningful," said Gao Yingxin, vice-chairman and chief executive of BOCHK.Forthcoming themes in the banknote series include butterflies which will adorn the HK$50 note and yam-cha " the tea and dim sum culture " that will appear on the HK$20. Both are due to be launched in early 2020.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.
- Financial Times
HSBC to lend extra £35bn to UK home buyers
HSBC UK is pressing ahead with its rapid push into British mortgages with plans to lend an extra £35bn to homeowners as the bank’s chief executive dismissed claims that its expansion was distorting the market. Ian Stuart, HSBC UK’s chief executive, said the bank intended to continue expanding its mortgage book so that its overall share of the market increases from roughly 7 per cent to 10 per cent. “I think our natural share’s about 11 per cent, but I don’t look out too far.
- GuruFocus.com
Stocks That Fell to 3-Year Lows in the Week of Aug. 30
HSBC Holdings PLC, Altria Group Inc., 3M Co. and Simon Property Group Inc. have declined to their respective three-year lows Continue reading...
- Bloomberg
Picking a Bank CEO in Europe. How Hard Can it Be?
(Bloomberg Opinion) -- Picking a new CEO is one of the most important decisions a board can take, yet one that Europe’s banks appear to be intent on flubbing. Lenders are struggling to find successors for the current crop of leaders.Take UBS Group AG. On Thursday, the Swiss bank revamped its management board, hiring a star banker from a rival and promoting two more insiders. Yes, the revamp is a step forward for gender diversity for firm whose senior ranks were distinctly lacking in women, and the appointees may turn out to be potential candidates for the top job in future years.But the reshuffle is also a sign that the number of potential internal successors for CEO Sergio Ermotti isn’t as big as it should be by now. Almost eight years into his tenure, the chairman and board of directors have few excuses. By now, there should already be several candidates just about ready to replace him.UBS isn’t alone in grappling with succession. Hours after naming a new CEO, Swedbank AB was criticized by Sweden’s biggest shareholder group for picking such an insider – and one who had failed to prevent the bank from engaging in alleged money laundering. Given the scandal wiped more than 40% off the bank’s shares this year and triggered the exit of the previous CEO, discontinuity wouldn’t have hurt.Then there’s Santander SA. A year ago, the Spanish bank hired UBS’s then investment-banking chief, Andrea Orcel, as its new CEO. Yet before he had even started the two fell out over compensation and are now locked in an acrimonious legal battle after Santander rescinded its offer. Santander resorted to asking the existing executive to stay in the job, raising doubts both about how the board came to hire Orcel in the first place.Among the global finance titans, HSBC Holdings Plc ousted CEO John Flint earlier this month. He was just 18 months into the job. Tensions with Chairman Mark Tucker and a clash of style were among the reasons for the exit, Bloomberg News reported. Surely the HSBC lifer’s strengths and weaknesses would have been a known quantity to the board by the time he was appointed.Europe’s diverse languages and cultures that go along with them do make filling the CEO post more challenging than in the U.S., but that means the boards and the incumbent executives should be even more focused on the task of avoiding leaving succession to chance.It would help to align CEOs’ pay more closely with how they have groomed and retained top talent so that if they were to be hit by the proverbial bus an internal replacement would be on hand. While financial targets are clearly important for any CEO, shielding the company from potential instability if they were to leave is perhaps an underrated but critical function.It’s up to shareholders to ramp up the pressure on companies’ boards. Choosing the right CEO is only going to get tougher as technology advances alter the economics, competitive landscape and opportunities. The next wave of CEOs may not be working in finance right now. Boards’ poor showing of late should be a cause for investor concern. To contact the author of this story: Elisa Martinuzzi at emartinuzzi@bloomberg.netTo contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Bloomberg
UBS and HSBC Robots Push Into Bond Sales Frontier
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.UBS Group AG and HSBC Holdings Plc are bringing robots into bond sales, a corner of banking still considered by many to be off limits to the onward march of automation.UBS has created a machine-learning algorithm that shows its salespeople the most likely counterparty to buy or sell a bond. HSBC is developing a bot that will send asset managers suggestions for bond transactions tailored to their existing trading patterns.While some bankers view bots in sales as an ominous development for one of the last bastions of old-style finance that runs off relationships, phone calls and working lunches, their bosses say the opposite is the case. Both banks say they want to make the process more efficient, relieving staff of more mundane tasks that get in the way of making money.Elsewhere in the industry, machines are already being widely adopted, adding to job insecurity for some at a time when banks are cutting staff to counter a weakening economy.“If salespeople are working much faster and more efficiently, you may need fewer of them,” said Tim Skeet, a career banker with almost 40 years experience in debt capital markets. “There is a fine balance between human and machine with sales because persuasion, judgment, knowledge and human contact are important, especially in less liquid markets.”UBS’s new system makes finding a match for a bond trade easier and quicker and has reduced the average number of calls a salesperson needs to make from five to three, according to Chris Purves, head of the bank’s Strategic Development Lab.The Swiss bank started rolling out the tool, known as Client Scout, in May after testing it earlier in the year. It sends an alert to the bank’s salespeople informing them UBS has a certain position and suggesting the most-likely candidates for the trade, ranked by percentage probability of a match, according to Purves.“This tool is as good as the best salesperson at knowing who to contact to get a trade done,” he said. “It brings everyone up to that level.”HSBC’s assistant, which doesn’t yet have a name, will build on an existing bot that HSBC’s salespeople started using in January to ensure they are up-to-date on the bank’s biggest events and best-read research. The tool monitors data on what research clients read and what events they attend. It has a 92% success rate when answering questions from sales, according to Ash Booth, head of artificial intelligence in HSBC’s corporate and institutional digital team.The new system can also compile research and trading ideas for clients, giving staff more time to work on transactions.“This has nothing to do with replacing salespeople but rather helping them and increasing their efficiency,” the bank said.MatchmakingHSBC plans to test the first version of its client system with a group of asset managers toward the end of this year, according to Sotiris Manderis, managing director in the bank’s corporate and institutional digital team.Whereas HSBC is targeting all asset classes, UBS has focused on credit because the market is particularly slow to trade. Individual bond positions sometimes take days or weeks to shift and Purves likens the market to a “dating agency” where sales try to match up buyers and sellers.Electronic systems are making leaps in corporate bond markets. UBS trades more than 13,000 bonds electronically today, an increase of more than 20% from a year earlier, according to Purves.Still, most of the market trades by voice and even after a salesperson uses Client Scout, the trade is executed manually between two people rather than automatically, he said.“Machines never get bored or tired, they just keep going,” said Purves. “But the last mile is human and it’s going to be a while before that changes.”To contact the reporter on this story: Katie Linsell in London at klinsell@bloomberg.netTo contact the editors responsible for this story: Vivianne Rodrigues at vrodrigues3@bloomberg.net, Chris VellacottFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
German Slump Threatens Bank Profits as Loan Risk Spreads
(Bloomberg) -- Germany’s deepening economic slump is squeezing the life out of the nation’s struggling banks, a little more than a decade after a crippling financial crisis from which many never fully recovered.Lenders ranging from Deutsche Bank AG and Commerzbank AG to HSBC Holdings Plc’s German subsidiary all reported deteriorating second-quarter earnings. They had to set aside more money for loans to companies reeling from the impact of global trade disputes, Brexit uncertainty and distress in the autos sector. All are now doubling down on cost cuts to offset the rising threat to profitability.“Headwinds from interest rates and the economy are intensifying,” HSBC’s Germany head Carola von Schmettow said on Wednesday. There is an “increased danger of credit defaults” in the second half of the year, according to the bank.The growing threat could hardly come at a worse time for a banking industry already debilitated by years of sub-par profitability and failed turnaround plans. Deutsche Bank recently unveiled the most sweeping restructuring plan in its recent history and has since acknowledged that the underlying macro-economic assumptions didn’t factor in the rapidly deteriorating outlook.Commerzbank is working on a strategy update while the world around it slides toward recession. About a third of the lender’s total loan book -- or about a fifth of its total balance sheet -- is pledged to German companies.The pain hasn’t just been felt at publicly-traded banks. State-owned Landesbank Baden-Wuerttemberg, as well as DZ Bank AG, Germany’s largest cooperative lender, also saw loan loss provisions rise in the first half after a benign period a year earlier.Rising risk provisions will be a test case for foreign banks operating in Germany too. HSBC, ING Groep NV, BNP Paribas SA and JPMorgan Chase & Co. have all been boosting lending to German companies in a bid to wrest market share from Germany’s largest corporate lenders on their home turf.ING’s German unit has been particularly active: it’s tripled lending to companies over the past half decade, growing corporate credit to 15% of its balance sheet last year.Intense competition from foreign banks has been one factor driving lax lending standards at some banks, regulators have said, though individual lenders including Commerzbank are keen to say that doesn’t apply to them. Still, some banks including BNP have indicated that they’re willing to lose money on some corporate loans if they can ultimately earn a return by selling the client other products.Almost all the banks are working on deeper cost cuts to cope with the challenge to their profitability. Deutsche Bank’s expense drive is the industry’s most ambitious by far as it rips out large swathes of its securities trading operations and scours its retail division for additional cuts as well, including centralizing its workforce in Frankfurt and closing additional branches, according to people familiar with the matter.The latest set of earnings may only have been the tip of the iceberg. Analysts expect the loan-loss provisions at both Deutsche Bank and Commerzbank to soar over the coming years, posing a growing threat to the banks’ bottom lines, especially if their efforts to stop several years of shrinking revenue continue to fail.The situation is compounded because both lenders are already burning through financial reserves to fund their overhauls. A surge in delinquent loans could bring the banks even closer to their minimum capital requirements -- at a time when raising fresh funds from investors is especially hard given their stock prices are near all-time lows.The outlook for some of Germany’s key industries and in particular the automotive sector is worrisome. Several carmakers and parts suppliers including Daimler AG and Continental AG have issued profit warnings. The insolvency last month of Eisenmann SE, a maker of surface coating machines for car producers, has increased the focus on the sector.This year, Commerzbank increased its expectations of losses from exposure to the automotive industry to the highest in more than four years. The larger part of the second-quarter loan impairments at HSBC came from a small number of big defaults, including within Germany’s automotive industry, according to a person familiar with the matter.“Some of Germany’s banks were struggling already during the boom times and that’s going to get worse in a weaker economy,” said Isabel Schnabel, finance professor at the University of Bonn and a member of Chancellor Angela Merkel’s council of economic advisers. “We’ll see in the downturn whether banks loosened their lending standards too far.”(Adds details about additional cost cuts in tenth paragraph.)\--With assistance from Stephan Kahl.To contact the reporters on this story: Nicholas Comfort in Frankfurt at ncomfort1@bloomberg.net;Steven Arons in Frankfurt at sarons@bloomberg.netTo contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net, Iain Rogers, Daniel SchaeferFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Motley Fool
Forget HSBC: 1 Singapore Bank That Has Growing Dividends
HSBC has a high dividend yield of 7% but there's a better Asian bank out there that pays growing dividends.
- Zacks
Scotia Bank's (BNS) Q3 Earnings Impressive, Costs Escalate
The Bank of Nova Scotia's (BNS) third-quarter fiscal 2019 (ended Jul 31) earnings reflect higher revenues, its solid capital levels and elevated expenses.
