Earnings Sentiment

Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.

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Sentiment Distribution

   

Earnings Call Transcript Word Cloud

     

Bullish Statements during Earnings call

Statement
Finally, we announced a third consecutive quarter of strong capital returns with a quarterly dividend of $0.10 per share and a further share buyback of up to $3 billion, which we expect to complete before the full year results in February
Transaction banking and wealth both performed well and continued investment will help accelerate the growth of our wealth business
Year-to-date reported profit before tax was $29.4 billion, which is an increase of $17.4 billion on the same period last year, supported by higher interest rates and enabled by our strong balance sheet and the non-recurrence of notable items
So in summary, this was another strong quarter
All of our businesses have been performing well
We have also exhibited good growth across our businesses
Wholesale transaction banking revenue was up 50% year-to-date, primarily due to higher rates and reflecting the strength of our deposit franchise
Wealth had another good quarter
The next slide shows our strong capital position
And we're also very pleased that we attracted $34 billion of net new invested assets in the quarter, bringing the rolling 12-month total of $277 billion, which is a strong performance and testament to our strategy
And we have a strong capital position and have increased return to shareholders by way of dividends and share buybacks
In our two home markets of Hong Kong and the UK, we are also seeing good growth areas
Look, all this at the end to say is we remain very optimistic in the medium to long term on both Hong Kong and mainland China
It ultimately will be a matter for the Board and the remuneration committee to decide but we felt it appropriate and fair to recognize that our colleagues have contributed, participated for the last many years through the whole strategic reshaping of the firm through ensuring we have a great deposit franchise and a strong balance sheet and obviously delivering the growth we've seen in wealth and transaction banking that we can channel 1% or the equivalent $300 million towards performance related pay
This is around 1% or $300 million more than previously guided due to higher technology and operation spending, which we believe is appropriate given the importance of digitization to the group and the strong financial performance of the business
But it's a factor of uncertainty in the half year over trading performance has become less uncertain as we've gone into Q3, and you've seen the numbers, and we hope we will continue in Q4 in a strong manner
We delivered a good profit performance and an annualized return on tangible equity of 17.1%, excluding strategic transactions, reflecting the successful execution of our strategy
And if that's the case, we feel we should reward our colleagues for a very strong performance this year
So in terms of loan growth, look, what we've observed so far is strong growth and continued growth in mortgages
Manus Costello A solid quarter
This included a resilient performance in foreign exchange compared to a strong third quarter last year and the good performance in securities financing and debt markets
Global Banking and Markets also performed well, up by 2%
Wealth and Personal Banking had a strong quarter with revenues up by 71% or by 7%, excluding the impairment taken in last year's third quarter relating to the sale of our retail banking operations in France
First of all, the year-to-date performance clearly demonstrates that we have had three consecutive strong quarters reflecting the successful execution of our strategy
But we feel as though we're well positioned
Within this, Wealth was up by 6% as our ongoing investment in that business continued to gain traction, and Personal Banking also had another good quarter up by 21% due mainly to higher rates
Now outside this softness area, we do still have strong loan growth potential in growing areas in our geographies such as Southeast Asia, such as India, such as the Middle East
The next slide shows that our global businesses all performed well
Our exposures rated strong, good and satisfactory were broadly stable on the third quarter last year
So in the context of things, we've given an indication that given the strong profit performance and if it continues into Q4, it will be right and proper to share some of that upside in profit compared to original expectations with our colleagues the way that we've intend to share the upside in expectations with our shareholders on both dividends and buybacks and a 1%, 300 million top up to VP for the level of performance that could well outturn this year is a reasonable amount of additional VP to put in
       

Bearish Statements during earnings call

Statement
All of the majors have missed our own forecasts and one of your peers wrote down their mainland Chinese [indiscernible] results
Acknowledging that the Chinese government has taken steps to support the sector, but the news flow still seems to be pretty negative
But also two is some of the softness we've seen in the economic conditions in Hong Kong, which we start to see reversing
I think we're now in a gradual rebuild, but that gradual rebuild will take time and there will be the potential for the industry to bear some further losses
And we felt that it would be adverse for certain customer outcomes if we needed to take more restrictive action on it
If we look at the UK bank [indiscernible], obviously, that margin has been under pressure this quarter and a number of peers are obviously flagging the lag effect on deposit cost as well as the migration is going to have an impact in Q4
The deterioration in the third quarter means that we crystallized around $500 million of provisions into the P&L that were part of this plausible downside
Obviously, it continued facing pressure on deposit cost
And this headwind is likely to continue for the next couple of years
The loss of innocent life and suffering is heartbreaking
And this is putting it in the context that our nine-month year-to-date reported cost is down 2% year-on-year -- is down 2% year-on-year
It has really impacted very heavily the real estate market
I suppose my bottoming comment was on the market as a whole in that there's been such a massive correction
We have all been shocked by the devastating terrorist attack on Israel on 7th of October and saddened by the growing humanitarian crisis in Gaza
As you can see, our total exposure stands at $7.5 billion, which is down by $0.5 billion from the half here, primarily due to write offs
In terms of commercial, the reality is the main softness in loan growth in commercial is in Hong Kong and this is what's driving the commercial overall number
And then as you -- so these would be the main headwinds
So what I'm talking about is the market as a whole, the commercial real estate market in China, a massive correction down
There was a lot of economic uncertainty around that time; inflation, interest rates, ACLs, China commercial real estate
Do I think that big negative correction in the market has been delivered and do I expect further negative correction? No
   

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