Hsbc Holdings Stock Earnings Reports

HSBC reported a strong Q1 2026 with profit before tax (ex-notable items) of $10.1bn and annualized RoTE (ex-notable items) of 18.7%. Revenue (ex-notable items) rose 4% YoY to $19.1bn, driven by banking NII and wealth fee/other income. The bank upgraded full-year banking NII guidance to around $46bn (reflecting a stronger interest rate outlook) and updated full-year expected ECL guidance to around 45 bps, noting a Q1 ECL charge of $1.3bn (annualized 52 bps) that included a $0.3bn precautionary charge related to the Middle East conflict and a $0.4bn fraud-related charge tied to secondary securitisation exposure. CET1 was 14.0%, down 90 bps this quarter primarily due to the Hang Seng privatization, but HSBC remains within its 14–14.5% operating range and declared a $0.10 quarterly dividend (targeting a 50% payout ratio for 2026, ex-notable items).

Business highlights: all four business lines grew revenues and delivered RoTEs above 17% (ex-notable items). Wealth fee income grew 15% to $2.7bn, with $39bn net new money in Q1 (Asia $34bn). Wholesale transaction banking, securities services, trade and payments all showed growth. Deposits grew $99bn over 12 months; 70% of deposits are instant access. Costs: on track for target ~1% cost growth in 2026 (target basis) after simplification savings; Q1 cost growth was 3% YoY driven partly by higher variable pay accrual. Strategic actions: completed Hang Seng privatization, sales of U.K. Life Insurance, Sri Lanka Retail Banking, South Africa, and agreed sale of Indonesian retail banking (expect up to $0.4bn gain on completion in H1 2027).

Risks & outlook: management reiterated 2028 targets (revenue +5% YoY excl. notable items; RoTE >=17%; 50% dividend payout) and emphasized ongoing macro uncertainty from the Middle East. The bank characterized the fraud-related charge as idiosyncratic, has reviewed high-risk exposures and tightened due diligence, and ran top-down stress scenarios (including a severe Middle East shock) that have been reflected in conservative guidance. Management expects continued capital generation and will consider buybacks quarterly subject to capital, loan growth and dividend priorities.