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Covid-19: HSBC / SC - Dividends & Results

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  1. #31

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    Quote Originally Posted by shri:
    Bit more nuanced than that ... it is after all considered "Hong Kong Bank" by many older generations.
    Typically for us in the industry or in related industry, we still call it hk bank when we speak of it.. e.g. we got a quote from hk bank... and its generally understood.

    yesterday i was just having lunch with a colleague of mine that's totally repeating what you said... guys that have taken out their retirement funds (millions) and dumped them all into HSBC because of the 6% yield..
    I feel sad for these guys..
    jrkob, shri, tf19 and 1 others like this.

  2. #32

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    To me this whole debacle reeks of some British gentlemen club handshake agreement under a cloud of heavy cigar smoke between HM BoE guys with the top 5 UK bank CEOs so the unilateral dividend cut doesn’t look like collusion by stating to “recommend” a dividend suspension. What a load of bull to first announce the dividend then wait till shareholders load up before the ex dividend and then scrapping it. Let’s not forget in case of HSBC that was the final dividend for 2019 which had nothing to do with Covid 19. It’s basically covering up their utter incompetence by using covid as an excuse. Other companies come to mind such as Boeing that use the same tactics of covid deflection to distract from their serious management problems.


  3. #33

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    Aug 2010
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    At this point...close to none, I cant see just where the growth will actually come from with HSBS. If it has relied on the PRD for growth then I can see some very large issues namely in the credit quality of customers. One very large issues is that of not incentivising its MRT, how will people who job is it to generate revenue be actually concerned with generating revenue? Without this the bank is in real trouble, and how to keep them. It really needs to start laying off people and not suspending its restructure but accelerating it.


  4. #34

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    I don't own shares of HSBC but I think there's something morally wrong with what the Bank of England is doing to HSBC's dividend.

    The Bank of England is effectively directing HSBC's cash literally away from shareholders to UK businesses. The BoE does not have a controlling stake in HSBC. HSBC, to my knowledge, has also not asked for a bailout or handout from the UK government.

    If the idea is to have HSBC lend more to small businesses in the UK, why not follow the US fed and temporarily remove reserve ratios or whatever it is that constrains bank capital? What am I missing here?

    A lot of retail shareholders in Hong Kong still depend on the dividend from HSBC. In the recent past there was an inspirational article (that I read on GeoExpat) about a taxi driver who saved money to purchase HSBC shares and live off of the income. Now what can he do? The share price is low so selling would be a terrible idea but he has lost his monthly income. Getting a part-time job in this environment is also unlikely.

    traineeinvestor likes this.

  5. #35

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    Nov 2014
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    Quote Originally Posted by TheBrit:
    What is the investment case for owning HSBC?
    I think that it is relatively stable in certain ways and you have some transparency on the weaknesses in the loans and their inability to do anything with their brand is priced in (I think). Lots of liquidity so if your catalyst doesn't materialize you can get out pretty quick.

    I think I'd start looking at it if it falls to HKD18 (maybe buy at HKD12 depending on the reason for the share price drop) but even at HKD37 I think it has problems going forward because it's so crappy and unchanging compared to alternative banks or other sectors even.

    I think you would buy, collect your dividend, and pray for that super CEO to utilize HSBC's large reach/brand and do something amazing/profitable. Maybe to do with tech or a streamlined business or some sort of new fangled business model - so I guess you'd pray on optionality.

  6. #36

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    Aug 2010
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    Its far too bloated with local unemployable staff to be investing in.

    Its now a takeover target by a CCP supported bank...for that reason if you hold stock then retain.

    There is no way that they could get away with a capital call from shareholders..who would underwrite it?

    They certainly need to start this restructure asap...not delay it.

    Last edited by shri; 03-04-2020 at 08:51 AM.

  7. #37

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    I think you would buy, collect your dividend, and pray for that super CEO to utilize HSBC's large reach/brand and do something amazing/profitable. Maybe to do with tech or a streamlined business or some sort of new fangled business model - so I guess you'd pray on optionality.
    Me thinks people have been waiting for about 5+ years for this to happen.

    I do agree with the implications of the dividend drop, specially given the demographics of their shareholders both in HK and the UK. Continuing to hear stories of older people who bought in/doubled down at 40ish to get a good dividend.

  8. #38

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    The new CEO isnt the answer...an external CEO was needed, with Quinn they will simply get more of the same..prediction he will be gone within 2 years.


  9. #39

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    Nov 2014
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    414
    Quote Originally Posted by shri:
    Me thinks people have been waiting for about 5+ years for this to happen.

    I do agree with the implications of the dividend drop, specially given the demographics of their shareholders both in HK and the UK. Continuing to hear stories of older people who bought in/doubled down at 40ish to get a good dividend.
    They could be waiting forever - odds of that type of CEO being hired by a bank like HSBC is very slim. I don't really see it, but I feel that this type of "hope" is priced in. It's core business is fine imo but the bank is overvalued if you consider just that core business.

  10. #40

    Join Date
    Dec 2009
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    188
    Quote Originally Posted by Viktri:
    I don't own shares of HSBC but I think there's something morally wrong with what the Bank of England is doing to HSBC's dividend.

    The Bank of England is effectively directing HSBC's cash literally away from shareholders to UK businesses. The BoE does not have a controlling stake in HSBC. HSBC, to my knowledge, has also not asked for a bailout or handout from the UK government.

    If the idea is to have HSBC lend more to small businesses in the UK, why not follow the US fed and temporarily remove reserve ratios or whatever it is that constrains bank capital? What am I missing here?

    A lot of retail shareholders in Hong Kong still depend on the dividend from HSBC. In the recent past there was an inspirational article (that I read on GeoExpat) about a taxi driver who saved money to purchase HSBC shares and live off of the income. Now what can he do? The share price is low so selling would be a terrible idea but he has lost his monthly income. Getting a part-time job in this environment is also unlikely.
    Just to zoom out a bit on the dividends point, I think a lot of mental accounting is at work when we create this huge distinction between selling shares at lows for cash (bad!) or to receive the dividend during a crash (good!) when it's just a zero sum game on a total return basis between dividends paid or capital gains. Divs are just forced sales since the stock price drops by the same amount, so your hypothetical investor is no better or worse off selling shares low or receiving the dividend, especially in a frictionless tax environment like HK.

    I understand that's not how we psychologically perceive it and there's a practical convenience in not having to log in to the account and manually sell. But this idea that "I'm not selling low so at least I still have the same number shares" while failing to see receiving a dividend is also a forced sale while the market is down is flawed IMO. It's taking from one hand to give the other.

    This outlines this psychological preference some more.
    https://www.forbes.com/sites/dirkcot.../#13c06cd4732e
    GentleGeorge likes this.

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