HSBC says outlook "very challenging", profit falls

http://uk.finance.yahoo.com/news/HSBC-says-outlook-challengi...

Hi richjfool

Yes, the price is a little down so far on the day. Berlussconi and the IMF are not helping matters though either. The analysts presentation is still to come though. Here is the IMS...


http://investegate.co.uk/Article.aspx?id=201111090815037584R...
..Reported profit before tax ('PBT') for the third quarter of 2011 ('3Q11') was US$7.2bn, up US$3.6bn on 3Q10, and for the nine months ended 30 September 2011 ('the nine months') was US$18.6bn, up US$4.0bn on the same period in 2010. These results included US$4.1bn of favourable movements in credit spread on the fair value of our own debt recognised in the quarter and US$4.0bn for the nine months.
• Underlying PBT for 3Q11 was US$3.0bn, down US$1.6bn on 3Q10 due to decreased revenues in Global Banking and Markets, an adverse movement in non-qualifying hedges of US$0.7bn (US$1.3bn recorded in the quarter and US$0.6bn in 3Q10), and an increase in loan impairment charges, primarily in North America, partially offset by increased revenues in Commercial Banking globally.
• Underlying PBT for the nine months was US$14.4bn, down US$0.3bn on 2010, reflecting the decreased revenues in Global Banking and Markets and higher costs offset by significantly lower loan impairment charges, principally in North America, and growth in Commercial Banking revenues.
• Annualised return on average ordinary shareholders' equity for the nine months was 12.6%, benefiting from the gains on movements in credit spread on the fair value of our own debt.
• Material progress has been made in implementing the strategy announced in May. Fourteen transactions have been announced so far this year, with 11 since 30 June 2011. Year to date, we have made good progress in expanding our Commercial Banking business across both developed and faster-growing markets and repositioning Retail Banking and Wealth Management.
• The reported cost efficiency ratio for the nine months worsened to 54.6% from 54.0% in 2010, and to 59.1% from 54.4% on an underlying basis. Operating expenses and full-time equivalent staff numbers ('FTEs') for 3Q11 were down on the preceding quarter, with FTEs down 5,000 since 1Q11.
• The core tier 1 capital ratio was 10.6% at 30 September 2011….


ATB
Tom

Hi guys,

I am/was tempted to add/return HSBC to my HYP this month.
Maybe that's not such a good iodea right now, ....or is it?

Thoughts please.

Ian.

Hi Ian,

I paid a lot more for these than they are now trading at but I intend to keep them for the long term. Right now, I would avoid all banks, but HSBC and Standard Chartered seem to be very decent punts if you have a long term horizon - and are braced for a bumpy ride. DYOR. Good luck!

LM

Hi lameuse,

Thanks for your input.

More than likely much like yourself,m the stocks I add to my HYP are meant to be held long term anyway.

I've put HSBC on the back burner for now, and might have another look mid 2012.

Cheers,

Ian.