HSBC said on Monday pre-tax profit fell in the first half of 2022 but it intends to resume quarterly dividends next year as the full-year outlook remained positive.
The company said it made $9.175 billion before taxes, down more than 15 percent from a year earlier.
Chief Executive Noel Quinn said: “This reflected a more normalized level of expected credit losses compared to Covid-19 disclosures released last year, as well as the macroeconomic impact of the Russia-Ukraine war.”
The outlook for annual revenue is positive, he said, as net interest income is expected to reach at least $31 billion this year and $37 billion next year as global interest rates rise.
Quinn said the group is confident of delivering its best returns in a decade in 2023.
“We also intend to return to quarterly dividends in 2023,” he added.
London-based HSBC was among a number of major banks to cancel their dividends early in the pandemic following a de facto directive from the Bank of England – a move that angered some Hong Kong shareholders.
The plan to resume payout came ahead of HSBC executives’ first face-to-face meeting with shareholders on Tuesday from the Asian financial hub in three years.
Executives are expected to ask questions about a restructuring offer from its largest shareholder, Ping An Insurance Group.
The lender is under pressure from Ping An, which owns a 9.2 percent stake, to spin off its Asian operations to unlock shareholder value amid tensions between China and the West.
Quinn and Chairman Mark Tucker have not publicly commented on Ping An’s campaign, but the bank has indicated that it intends to maintain its current structure while continuing a focus on Asia, Bloomberg reported.
Hong Kong politician Christine Fong said on Sunday that separating HSBC’s Asia operations and returning the primary listing to the city was the “best way to protect (interests of) minority shareholders”.
Fong, who reportedly represents 500 retail investors in HSBC stock, also supported Ping An getting seats on HSBC’s board, citing the canceled dividends in 2020 as the reason.
Last year, HSBC pledged to accelerate a multi-year focus on Asia and the Middle East with a goal of leading the Asian wealth management market.
The bank said it would invest $6 billion in Hong Kong, China and Singapore and hire more than 5,000 wealth advisors – while cutting 35,000 jobs and slashing its retail operations in the United States and France.
According to Bloomberg, HSBC hired Goldman Sachs and consulting firm Robey Warshaw to reject Ping An’s campaign.
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