HSBC Bank (HSBC) has announced a new $3 billion stock buyback program even as it reported disappointing second-quarter financial results.
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Europe’s largest lender announced a quarterly profit of $6.30 billion, which fell short of the $6.99 billion expected on Wall Street. Revenue in the period came in at $16.50 billion, which missed the consensus estimate among analysts of $16.67 billion. The profit was down 29% from a year earlier.
Management blamed the poor showing on impairment charges related to a Chinese bank and a loss of income from businesses it recently sold. Still, despite the lackluster results, HSBC announced a new share repurchase program worth $3 billion.
Dividend Cut
While it may have launched a new buyback initiative, HSBC also announced a cut to its quarterly dividend alongside its financial results. The British bank declared a quarterly distribution of $0.50 per share, payable on Sept. 26 of this year. That’s down 39% from a previous dividend payout of $0.82 a share each quarter. HSBC had boasted a dividend yield of 5.38%.
HSBC CEO Georges Elhedery said that the lender is dealing with “structural challenges” to the global economy that have caused uncertainty and market volatility. He said the bank anticipates ongoing issues this year due to “broad-based tariffs” and “fiscal vulnerabilities.” HSBC warned that demand for lending would remain weak for the rest of 2025, while forecasting some growth in its wealth division.
HSBC stock is up 29% so far this year and has benefited as investors rotate into European stocks.
Is HSBC Stock a Buy?
Currently, only one U.S.-based analyst follows HSBC stock. So instead we’ll look at the company’s three-month share price performance. As one can see in the chart below, HSBC stock has risen 18% in the past three months.
