Hong Kong, Feb 25, 2026, 16:28 HKT — Market closed.
- HSBC’s Hong Kong shares closed up about 4% while London shares rose nearly 5% in early deals.
- Bank lifted its profitability target and set 2026 guidance for interest income, costs and credit charges.
- HSBC said it will hold off on new buybacks until its core capital ratio is back in its target range.
HSBC shares climbed on Wednesday after the bank lifted a key profitability target and mapped out 2026 guidance, including a pause on fresh share buybacks until capital ratios recover from the Hang Seng Bank deal. Hong Kong-listed shares ended at HK$140.90, while the London line traded at 1,355.20 pence in early deals, HSBC’s share-price feed showed. (HSBC)
The move matters because HSBC’s rally has left investors hungry for the next leg — not another story about “simplification”, but hard numbers on capital returns, costs and what happens to earnings when rates move.
With Hong Kong cash trading done for the day, attention shifts to whether London follows through and how quickly management can rebuild buffers for buybacks without crimping growth.
HSBC said it is targeting return on tangible equity — a profitability gauge that strips out intangible assets — of 17% or better for 2026 to 2028, excluding notable items. It forecast banking net interest income of at least $45 billion in 2026 and said it aims to keep target-basis operating expense growth around 1% this year, while credit losses run at about 40 basis points of average loans. (HSBC)
Annual pretax profit slipped 7% to $29.9 billion, hit by $4.9 billion of one-off charges, though it still came in about $1 billion above a consensus forecast, Reuters reported. Chief executive Georges Elhedery said the bank was “becoming a simple, more agile, focused bank built for a fast-changing world.” (Reuters)
The one-offs included a $2.1 billion write-off tied to HSBC’s stake in China’s Bank of Communications and $1.4 billion of legal provisions, Reuters said. HSBC also booked $1 billion of restructuring and related costs as it pushed through exits and management cuts.
HSBC said it will keep its common equity tier 1 (CET1) ratio — a core capital measure — within a 14% to 14.5% target range over the medium term, but flagged that the Hang Seng privatisation could drag it below that band. It said it will not start further buybacks until the ratio is back within, or above, the target range.
HSBC’s final dividend was set at 45 cents a share, taking the 2025 total to 75 cents, below the 87 cents paid for 2024, Reuters reported. The payout matters for holders who have treated HSBC as a yield stock as much as a turnaround trade.
One “but”: the clean story can get messy fast. Credit costs tied to commercial property exposures in Hong Kong and mainland China, plus legal and restructuring bills, can still bite — and the bank’s low-cost-growth pledge hinges on how much it has to spend on technology to keep pace.
Next up, investors will pick through the detail around the timing of capital rebuild and the sensitivity of 2026 interest income to policy-rate shifts — the assumptions that sit behind that $45 billion-plus banking NII line.
HSBC’s next big scheduled catalysts are its 1Q 2026 earnings release on May 5 and its annual general meeting on May 8, according to the bank’s financial calendar. (HSBC)
