HSBC set to launch $1bn buyback despite revenue miss

HSBC has unveiled a $1 billion share buyback plan, despite its third-quarter revenue falling short of market expectations. The FTSE 100 bank reported a $9.63 billion profit for the quarter, which was generally in line with consensus forecasts of $9.69 billion. However, revenue missed the mark after HSBC recorded $18.6 billion, below the forecasted $18.9 billion.

The over $300 million shortfall followed underperformance in banking net interest income, which delivered about $11.6 billion, some $247 million below expectations. Revenue in the bank's wealth division was also softer than expected at $2.7 billion, compared to a $2.8 billion consensus. HSBC's interim dividend of $0.1 per ordinary share, equating to around $1.7 billion being paid out to investors, along with the buyback, could bring returns for the quarter to around $2.7 billion.

Group Chief Executive Georges Elhedery stated that despite the challenging environment, clients continue to turn to HSBC to navigate uncertainty and seize new opportunities, highlighting consistent execution of strategic priorities. HSBC's operating expenses dropped 12% to $8.8 billion, mainly due to the absence of a major legal charge.

The bank also made a $1.1 billion provision in its third-quarter results due to a Luxembourg court rejecting an appeal related to an investment fraud case associated with the Bernie Madoff scandal.