HSBC holds informal meeting with Hong Kong shareholders

2 August 2022

Group Chairman Mark Tucker, Group Chief Executive Noel Quinn and Chairman of The Hongkong and Shanghai Banking Corporation Peter Wong today met our Hong Kong retail shareholders.

The meeting was held at the Kowloonbay International Trade and Exhibition Centre.

During the meeting, the following points were made:

Mark Tucker, Group Chairman, said: “I know that the cancellation of the dividend in 2020 was a significant disappointment for you – and how much distress and pain it caused. This is the first opportunity we have had to speak to you face-to-face and, on behalf of us all, I apologise sincerely for the impact this has had on each and every one of you, and your families.

“We appreciate that you have strong views on the matters that you care about, and your passion for HSBC is of the utmost importance to us. And we should never lose sight of the fact that we share the same objectives – improving shareholder returns and dividends, the success of our bank and the continued development of Hong Kong. We are incredibly proud of our Hong Kong business. It continues to be one of our strongest franchises. And we will continue to invest in it because we remain fully committed to it, to you and to Hong Kong.

“The Board has a clear responsibility to protect and grow shareholder value, and the work to date suggests that the separation structures would not be consistent with that and would destroy value. While our work is ongoing, and we continue to listen carefully, we continue to believe that our current strategy and structure will deliver very good returns over the next few years and offer significant and material benefits over other options.”

Noel Quinn, Group Chief Executive, said: “Connecting customers internationally has always been what our bank does best. The value of our global network is also reflected in our performance. Trade revenue in Commercial Banking increased by nearly 20 per cent in the first half, underlining that our greatest strength is our ability to bridge capital and trade flows between the major economies of the world. All our regions were profitable in 2021, and again in the first half of 2022.

“We’ve got strong revenue momentum across all of our businesses. We have also got a good control of costs, despite rising inflation around the world. And we have normalising interest rates.

“These three things – along with our progress on transformation – mean we can be more ambitious about our future performance. We are confident of achieving a return on tangible equity of at least 12% from 2023 onwards. This would represent our best return in a decade.

“And, as a result, we are upgrading our dividend pay-out ratio guidance to around 50 per cent for 2023 and 2024. We are also returning to quarterly dividends in 2023. As I said earlier, we understand how important dividends are to you – our loyal Hong Kong shareholders. I’m pleased you will be able to share the benefits of the improved performance that our strategy is driving.”

Mr Quinn also announced three initiatives to help support Hong Kong’s economic recovery: “First, we will launch a new HKD40 billion financing scheme to help small and medium-sized enterprises in Hong Kong. This fund will help them expand, create jobs and digitise. The companies that we will help with this funding are the backbone of Hong Kong’s economy. They constitute more than 98 per cent of Hong Kong’s businesses and employ about 45 per cent of the private-sector workforce. Their success and vitality are crucial to Hong Kong.

“Second, we will abolish fees and charges on basic banking services to support our most vulnerable customers. In addition to the fee waiver announced in 2019, this initiative will save our customers around HKD200 million a year.

“Third, in line with Hong Kong’s ambitions on digital inclusion and to become a Smart City, we will launch a brand new, simplified version of our mobile banking app. It has been specifically designed to help everyone reap the benefits of digital banking, and we think will particularly be welcomed by some of our older customers who may not currently use the banking app.”

Peter Wong, Chairman of The Hongkong and Shanghai Banking Corporation, said: “HSBC has been established for 157 years, and we place a lot of emphasis on our relationship with the community. This is not only to provide banking services for residents of various districts, but as a member of the community. It is our duty to make everyone’s life better and have a positive impact on the community in the long run.

“Through HSBC’s charitable foundation, the bank over the past 40 years has supported more than 10,000 projects.

“We hope to further strengthen our support for the community, therefore we are announcing today that the Hongkong Bank Foundation will donate another HKD100 million to help people in need in society, including improving their living, meet the needs of young people, etc.

“We hope that Hong Kong will recover from the pandemic as soon as possible.”