HSBC 02 (0005) (Jun 10 - Dec 27)

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<Research>Barclays Optimistic About HSBC HOLDINGS Plan to Privatize HANG SENG BANK', Bringing Potential EPS Upside

Barclays released a research report expressing optimism about HSBC HOLDINGS (00005.HK) 's plan to privatize HANG SENG BANK (00011.HK) .

Although achieving synergies requires patience, the transaction is expected to bring significant upside potential for EPS, with an attractive value based on a forward PE ratio of 7.5x.

Therefore, Barclays reiterated rating at Overweight. While the transaction may impact short-term capital return yields, it is believed that over time, it could create ideal value and welcomes the Group's increasing capital focus towards Hong Kong.

Related News: DBS Raises HSBC HOLDINGS TP to $113.7, Expects Div. Yield 5%+ in 2026 & 2027

The broker expected HSBC HOLDINGS to have prominent upside potential in earnings through stronger net interest income and fee income, as well as improved cost efficiency.

Source: AASTOCKS Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

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Fitch: HSBC HOLDINGS' Planned Privatization of HANG SENG BANK Enhances Strategic Synergy

HSBC HOLDINGS (00005.HK)'s plan to privatize HANG SENG BANK (00011.HK) should enhance the strategic synergy and operational integration of HANG SENG BANK, Fitch Ratings stated, reaffirming HSBC HOLDINGS' A+ rating with a Stable outlook.

Privatizing HANG SENG BANK should eliminate structural constraints on integration, making capital and resource allocation in HSBC HOLDINGS' Hong Kong operations more efficient, Fitch noted.

Given HSBC HOLDINGS' strong execution record, Fitch believed such synergies are achievable in the medium to long term.

Related News: CICC: Decline in Div./ Buyback Yield Caused by HANG SENG BANK Privatization May Drag HSBC HOLDINGS Temporarily

Fitch mentioned that HSBC HOLDINGS' robust and prudent capital management will allow the bank's Tier 1 capital ratio to return to the target level of 14-14.5% in a relatively short time.

Source: AASTOCKS Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

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<Foresight>Brokers Predict HSBC HOLDINGS 3Q Pre-Tax Profit to Drop 5%; Focus on Operational Strategy & Shareholder Return Guidance

HSBC HOLDINGS (00005.HK) is set to announce its 3Q25 results on October 28 (Tuesday).

While HSBC HOLDINGS has been benefiting from the rise in HIBOR since August to have some of its NIM pressure alleviated, the market still expected its results to be affected by "items to be noted" (non-recurring items, estimated by the market to include dilution and impairment losses related to its associate company, BANKCOMM (03328.HK) as HSBC HOLDINGS' stake in it fell from 19.03% to 16% after the completion of its A-share issuance in June).

Related News: Barclays Optimistic About HSBC HOLDINGS Plan to Privatize HANG SENG BANK', Bringing Potential EPS Upside

According to the forecasts from four brokers as summarized by our reporters, HSBC HOLDINGS' 3Q25 pre-tax profit is projected to range from USD6.264 billion to USD8.1 billion on a reported basis, down 4.4 - 26.1% YoY from USD8.476 billion in the same period last year.

The median of USD8.0535 billion also represents a nearly 5% YoY decline.

Investors will focus on HSBC HOLDINGS' net interest income and non-interest income growth performance, future dividends, CET1 ratio guidance as well as the latest operational guidance related to its plan to privatize HANG SENG BANK (00011.HK) and the synergy effects it brings.

Broker│3Q25 Pre-Tax Profit Forecast on Reported Basis│YoY Change
Jefferies│USD8.1 billion│-4.4
Goldman Sachs│USD8.091 billion│-4.5%
Citi│USD8.016 billion│-5.4
Morgan Stanley│USD6.264 billion│-26.1%

Calculated based on HSBC HOLDINGS' pre-tax profit of USD8.476 billion on a reported basis for the same period last year.
Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

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<Research>JPM: ST Impact of Privatization of HANG SENG BANK Reflects in HSBC HOLDINGS' Shr Price

JPMorgan released a research report believing that the short-term impact of the plan to privatize HANG SENG BANK (00011.HK) has already been reflected in HSBC HOLDINGS (00005.HK)'s share price.

Investors may not factor in long-term synergies until management provides more quantitative guidance.

The 3Q25 results will be a short-term driver for stock prices, with transaction costs and credit costs due to exposure to Hong Kong commercial real estate (CRE) being key variables.

Furthermore, STANCHART (02888.HK) stumbled 5.1% on 17 October, underperforming the HSI/ HSBC HOLDINGS by 2.6/ 3.1 ppts each, possibly due to investors' risk-off sentiment on US credit risk events.

JPMorgan kept ratings at Overweight for both HSBC HOLDINGS and STANCHART, but preferred STANCHART on a 6-month investment outlook.

The broker kept its target price for HSBC HOLDINGS at $122, and lifted its target price for STANCHART from $162 to $168.

Source: AASTOCKS Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN