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HSBC’s Quinn exits with $4.8 billion gift to shareholders
HSBC Group has announced an additional $4.8 billion (approximately £3.7 billion) payout to shareholders, including a $3 billion (approximately £2.3 billion) share buyback and $1.8 billion (approximately £1.4 billion) in dividends.
It comes after the bank reported a 1.5% rise in pre-tax profit to $8.9 billion (approximately £6.9 billion) in the second quarter.
The move marks a final act for outgoing CEO Noel Quinn, who oversaw $34.4 billion (approximately £26.8 billion) in shareholder payouts during his tenure. Mr Quinn will be succeeded by CFO Georges Elhedery in September.
HSBC’s profit growth was driven by its wealth division and increased demand for investment banking services, offsetting an 11% drop in net interest income. The bank raised its full-year net interest income forecast to $43 billion (about £33.5 billion), depending on global interest rates.
Despite setting aside $346 million (approximately £269 million) for potential defaults, this was significantly lower than last year.
Mr Quinn said: “After delivering record profits in 2023, we have delivered another strong profit performance in the first half of 2024, which is further evidence that our strategy is working.
“Our wealth investment is generating higher and more diversified revenue, and we continue to grow our core international and scale businesses, which helped us deliver $13.7 billion in distributions over the first half of the year. We are confident that we have the right strategy and model in place to grow revenue even in a lower interest rate environment, and are therefore providing new guidance of a mid-teens return on average tangible equity by 2025.”
He concluded: “I have always been immensely proud of the heritage of this bank and the strategic role it plays in the world. My objective when I took this role was to deliver financial performance that was commensurate with our position. Working together, I believe we have done that and created a strong platform for growth.”