A capital return programme of up to US$1 billion was announced at the bank’s interim results, marking the group’s first repurchases since the privatisation of Hang Seng Bank.
HSBC resumes share buybacks with stock price trading at an all-time high
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HSBC reported stronger-than-expected first-half numbers on tighter cost controls, prompting the group to upgrade its net interest income guidance for 2026 while reiterating targets for 2027 and 2028.
For the first six months of this year, group revenues rose 11 percent to US$37.7 billion, driven by a pickup in wealth fees and other income from its international wealth and premier banking units. Profit before tax increased 23 percent to US$19.5 billion, supporting an annualised return on tangible equity (RoTE) of 18.2 percent, up from 14.7 percent a year ago. The bank’s net interest margin was 1.6 percent.
The loan book grew by 6 percent while deposits rose by 8 percent. HSBC upgraded its earnings guidance after raising its full-year cost savings target from US$1.5 billion to US$2 billion. It now expects net interest income to exceed US$46 billion, driven by a favourable interest rate outlook, with its RoTE to remain above 17 percent for the next three years.
A capital return programme of up to US$1 billion was also announced at the bank’s interim results, marking the group’s first repurchases since completing the privatisation of Hang Seng Bank earlier this year. The buyback marks a noticeable pivot. Management had previously stated that it would refrain from repurchasing its own shares until capital ratios had improved following the merger.
[See more: Standard Chartered upgrades 2026 guidance amid stronger first-half earnings]
The bank has been streamlining its operations, recently selling its Singapore insurance book as well as its Australian mortgage businesses.
With the stock price up a third this year, the upbeat outlook marks a noticeable shift in sentiment after Beijing announced reinforced capital curbs. Back in June, Bloomberg Intelligence estimated that in a worst-case scenario, a 30 percent drop in HSBC’s new wealth money flows could lower pretax profits by up to 1.2 percent.
The results follow Standard Chartered’s first-half results, where the bank also upgraded its income guidance after reporting a 17 percent increase in earnings-per-share. Like HSBC, Standard Chartered announced a US$1 billion share buyback as well.
