HSBC Holdings, plc.
HSBC · NYSE
Dec 2026
Next quarter
Expected to report Feb 24, 2027 — estimated from last year’s reporting date.
Consensus is $2.03 EPS for Dec 2026 across 1 estimates, ranging $2.03 to $2.03.
HSBC Sep 2026
- 1.41%
- +0.42%
- $2.13
- $2.10
- —
- —
Highlights
- Reported EPS: $2.10, 1.41% below the $2.13 consensus; EPS excluding notable items rose 17% year over year, partly reflecting lower minority interest after Hang Seng Bank’s privatization.
- Underlying earnings: Revenue increased 5% to $18.7 billion and profit before tax rose 10% to $10.0 billion year over year on a constant-currency basis, both excluding notable items; notable items reduced profit by $0.4 billion.
- Net interest income: Banking NII increased $0.6 billion year over year to $11.7 billion, and rose quarter over quarter; HSBC reiterated full-year 2026 guidance of at least $46 billion.
- Capital and returns: CET1 was 13.9%, down 20 basis points in the quarter; HSBC announced a further share buyback of up to $1 billion and estimated a 40–50-basis-point CET1 benefit from Basel 3.1 adoption in January 2027.
- Deposits and wealth: Deposits grew $105 billion over 12 months, including held-for-sale balances; Wealth net new money was $41 billion globally and $38 billion in Asia, including $14.5 billion of India FCNR deposits.
- Credit: The third-quarter expected credit loss charge was $0.8 billion, or an annualized 31 basis points of loans; full-year 2026 guidance remains around 45 basis points.
- Costs and simplification: Target-basis cost growth was 1% year over year; $1.9 billion of simplification savings has been delivered against the $2 billion target set at the half year.
- Franchise returns: Each of HSBC’s four businesses grew deposits and delivered annualized return on tangible equity above 17%, excluding notable items; group annualized RoTE was 18.8% year to date.
Analysis
HSBC delivered broad-based underlying growth in the third quarter, though reported EPS of $2.10 narrowly missed the $2.13 consensus by 1.41%. On a constant-currency basis and excluding notable items, revenue rose 5% year over year to $18.7 billion and profit before tax increased 10% to $10.0 billion; notable items reduced profit by $0.4 billion. EPS excluding notable items rose 17%, helped in part by lower minority interest following Hang Seng Bank’s privatization. Banking NII reached $11.7 billion, up $0.6 billion year over year and also higher sequentially, while deposits grew $105 billion over 12 months.
The print was defined by revenue growth across businesses, deposit and balance-sheet expansion, and disciplined costs, alongside emerging pressure on deposit margins in Hong Kong and increased U.K. deposit competition. HSBC said higher time-deposit migration in Hong Kong became more pronounced late in the quarter, but maintained that deposit growth remains NII-positive. Credit performance was stable, with a $0.8 billion ECL charge, and guidance was unchanged: at least $46 billion of 2026 banking NII, around 45 basis points of full-year ECL, and 1% target-basis cost growth. Capital was 13.9% at quarter-end; the bank announced up to $1 billion of additional buybacks and estimated a 40–50-basis-point CET1 benefit from Basel 3.1 in 2027.
Revenue and earnings
- Underlying growth: On a constant-currency basis, revenue rose 5% year over year to $18.7 billion and profit before tax increased 10% to $10.0 billion, excluding notable items. Those items adversely affected profit by $0.4 billion.
- Business breadth: Revenue grew across three of the four businesses, with CIB the standout; IWPB revenue edged down as strategic transactions and the absence of roughly $0.1 billion of prior-year insurance benefits more than offset growth.
- Earnings per share: Reported EPS was $2.10 against $2.13 expected, a 1.41% miss. EPS excluding notable items increased 17% year over year, partly because Hang Seng Bank’s privatization reduced minority interest.
- Returns: Annualized group RoTE was 18.8% year to date, 1.1 percentage points above the prior-year level. All four businesses delivered annualized RoTE above 17% in the quarter, excluding notable items.
Net interest and deposits
- Banking NII: Banking NII rose $0.6 billion year over year to $11.7 billion and increased sequentially, supported by balance-sheet growth. The quarter-on-quarter comparison also included $0.1 billion each from one-offs, the structural hedge and day count.
- Deposit mix: Deposits increased $105 billion over the last 12 months, including held-for-sale balances. In Hong Kong, $21 billion of quarterly deposit growth came with greater migration to time deposits: their share was 38%, with pressure on time-deposit margins.
- Market position: HSBC said Hong Kong’s deposit growth remains incrementally positive for NII. U.K. retail deposit competition has intensified, but the bank cited its low loan-to-deposit ratio and high share of instant-access deposits as flexibility to manage pricing.
- Guidance and disposals: Full-year 2026 banking NII guidance remains at least $46 billion. Strategic disposals are expected to reduce revenue by $2.2 billion cumulatively: $700 million in 2026, a further $900 million in 2027 and the final $600 million in 2028.
Wealth and transaction banking
- Wealth flows: Net new money was $41 billion globally and $38 billion in Asia. The Asian total included $14.5 billion of FCNR deposits raised in India; the offering closed at the end of August, while runoff of the Australian book partly offset inflows.
- Wealth activity: Investment distribution income grew 7% year over year, reflecting higher mutual-fund and structured-product sales. Private Banking grew 16%; Asset Management’s AUM growth was offset by margin compression.
- Wholesale transaction banking: Full revenue from trade and payments rose $0.8 billion, or 12%, year over year. Trade fees increased 5% and payments 4%; Securities Services fee and other income rose 3%, while foreign exchange revenue increased 19% amid higher market volatility.
Credit and cost discipline
- Credit quality: The $0.8 billion quarterly ECL charge equated to an annualized 31 basis points of loans and advances. HSBC described overall performance as broadly stable and reported a very low net charge in Hong Kong commercial real estate.
- Credit outlook: Full-year 2026 ECL guidance remains around 45 basis points. Management said it saw nothing of concern for the fourth quarter, while noting the longer quarter and keeping the guidance unchanged.
- Costs and savings: Target-basis costs increased 1% year over year, and HSBC remains on track for 1% cost growth for 2026 versus 2025. It delivered $0.2 billion of simplification savings in the quarter, bringing cumulative savings to $1.9 billion against the $2 billion target.
- Cost outlook context: Management said strong performance could lead it to consider a modest increase in variable pay, with a decision expected in January. It gave no 2027 cost guidance; redeployment of costs from disposals and continued investment are part of its plans.
Capital and shareholder returns
- CET1 position: The ratio was 13.9%, down 20 basis points in the quarter. HSBC generated 90 basis points of CET1 from regulatory profits, while the quarter also reflected the prior quarter’s buyback, strategic initiatives, RWA growth and negative fair-value movements in the hedge portfolio.
- Basel 3.1: HSBC estimates adoption from 1 January 2027 will add 40–50 basis points to CET1, principally through lower RWAs on sovereign, SME and large-corporate exposures. The estimate remains subject to portfolio changes, model refinements and regulatory permissions.
- Capital distribution: The bank announced a further buyback of up to $1 billion. It reiterated its 14%–14.5% target operating range and said its capital allocation priorities remain a 50% dividend payout, organic growth and buybacks as the preferred residual distribution.
