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13292 JP-HSI @EC2006I (CALL)
RT Nominal down0.011 -0.003 (-21.429%)

18/02/2020 17:27

{I-bank focus}UBS sees huge restructuring risk for HSBC

[ET Net News Agency, 18 February 2020] UBS Global Research said HSBC's (00005) reported
a stated 4Q 2019 loss before tax of US$3.9bn driven by US$7.3bn in goodwill write-offs. On
an underlying basis, the research house has adjusted PBT (profit before tax) in 4Q at
US$4.4bn, 11% ahead of company-compiled consensus.
Within this, income was 4% higher, partially offset by 3% higher costs and with the
impairments 23% below consensus. Hong Kong loan losses, in particular, were better than
feared given local conditions.
The strategic plan to end 2022 aims to reallocate a tenth of group capital from low
return (principally European and US Markets) activities to higher return mid-market, Asian
and Middle Eastern businesses, improving run-rate returns, longer-term growth and helping
pay the near term dividend.
With significant restructuring risk - including material P&L negative operating leverage
in 2020 and 2021 in particular - UBS remains cautious about near term trading. It retained
its "neutral" call and GBP5.3 (or HK$53.5) target price on HSBC. (KL)

Remark: Real time quote last updated: 30/03/2020 14:27
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