Third quarter numbers from HSBC were a lot better than feared, despite the 36% drop in profit, and the company hinted at plans to pay a dividend for the final quarter.
This decision is out of its hands for now given the moratorium on dividends imposed on banks by the regulator, but this situation is up for review in the near term and the decision to mention a pay-out at all may suggest HSBC has an idea of which way the winds are blowing.
The company can also point to a very generous capital buffer when it comes to its ability to sustain dividend payments without overstretching itself.
“Elsewhere the job of turning around the giant super tanker of a business which HSBC represents continues. It is a tough ask for CEO Noel Quinn, in post for just over a year, and one which arguably proved beyond his predecessors,” said AJ Bell’s Russ Mould.
“The company is not letting up the pace on cost cuts and, in a move which may not prove popular with customers, it looks as it start charging for bank accounts in markets like the UK.
“This reflects the pressure on profitability caused by an ultra-low interest rate environment and if HSBC takes this step some of its rivals may consider similar moves with their own high street banking operations.”