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HSBC $2.5 bln buy-back after profits tumble

Wednesday, August 03, 2016 - 01:30

HSBC announces a $2.5 billion share buy-back as it takes steps to soothe investors after a near 30 percent drop in first-half core profits. Rosanna Philpott reports.

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HSBC announcing Wednesday a share buy-back of $2.5 billion after their profits plummeted nearly 30 percent compared to last year. Reuters banking correspondent Lawrence White says management feel the stock is undervalued but shareholders have been soothed by the news SOUNDBITE (English) LAWRENCE WHITE, REUTERS BANKING CORRESPONDENT, SAYING: "So investors have taken some comfort from this measure the shares rose 3.5% initially before fallen down slightly afterwards. the bank also said they're going to abandon their timetable for achieving a 10% return on equity which would suggest realism in the face of slowing global economic growth" Revenues have been hit by sluggish growth in key markets Europe and Hong Kong. And there could be more dark clouds on the horizon... including fallout from the Brexit vote... and China's slowing economy SOUNDBITE (English) LAWRENCE WHITE, REUTERS BANKING CORRESPONDENT, SAYING: "The Brexit impact has been small business reducing application for funding, there's apprehension whether to invest or not. HSBC said it was removing 'progressive' from its guidance on dividend signaling that they don't expect to be growing dividend in the face of growing economic uncertainty" But the problems don't stop there. Europe's banking sector has been rattled by record low interest rates and rising regulator costs. HSBC's CEO Stuart Gulliver says uncertainty is likely to last for some time...

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HSBC $2.5 bln buy-back after profits tumble

Wednesday, August 03, 2016 - 01:30