27.87-0.20 (-0.71%)
At close: January 8 4:00PM EST
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| Previous Close | 28.07 |
| Open | 28.03 |
| Bid | 27.87 x 1800 |
| Ask | 27.98 x 4000 |
| Day's Range | 27.65 - 28.08 |
| 52 Week Range | 17.95 - 38.85 |
| Volume | 2,055,620 |
| Avg. Volume | 3,013,615 |
| Market Cap | 113.785B |
| Beta (5Y Monthly) | 0.57 |
| PE Ratio (TTM) | N/A |
| EPS (TTM) | -0.55 |
| Earnings Date | N/A |
| Forward Dividend & Yield | N/A (N/A) |
| Ex-Dividend Date | Feb 27, 2020 |
| 1y Target Est | 27.08 |
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Zacks•2 days agoHSBC Likely to Cut 2020-End Bonus by 22.5% on Coronavirus Impacts
HSBC Holdings' (HSBC) plans to reduce bonuses for junior staff in order to cope with the pandemic's adverse impact on businesses.
- South China Morning Post•3 days ago
HSBC to cut year-end bonuses for junior staff by 22.5 per cent as coronavirus pandemic weighs on performance
HSBC plans to reduce bonuses for its junior staff globally by 22.5 per cent for 2020 as it navigates a difficult operating environment marked by the economic fallout of the coronavirus pandemic and historically low interest rates.The largest of Hong Kong's three currency-issuing lenders, HSBC will cut bonuses for its frontline and back office staff who are part of its streamlined variable pay programme in grades 6 to 8, according to an internal memorandum seen by the Post. "The challenging external environment in 2020 has had a significant impact on business and group performance with reported profit in our Q3 YTD results down 62 per cent and adjusted profit down 44 per cent," the memo said. "It is appropriate that we adjust the [streamlined variable pay] grid as a result."Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.Variable pay was only reduced by 22.5 per cent to "reflect the exceptional performance of staff in supporting customers and each other and helping to build the bank for the future," a spokeswoman said. Total compensation for affected employees is mostly flat or slightly up from the previous year as a result, she said.Employees in the streamlined variable pay programme receive a discretionary bonus in February of the following year based on their performance and behaviour ratings, which is calculated using a formula. Most of its junior staff globally fall within the programme.For example, top performers in grades 6 to 8 would receive a bonus equivalent to about 2.3 times one month's salary under the revised formula.The London-based lender's employees fall within grades zero to 8, with zero representing its most senior leaders.The announcement came nearly a month after HSBC's chief regulator in the United Kingdom said it was comfortable with British lenders resuming shareholder payouts.HSBC and crosstown rival Standard Chartered were asked to suspend their dividends and share buy-backs in April as part of a coordinated response to the pandemic and its effects on the economy. The move sparked a shareholder revolt in Hong Kong, but their shares have recovered sharply in recent months as the economic outlook has improved.The bonus cut comes after HSBC, Europe's biggest bank by assets, and other lenders navigated a difficult operating environment in 2020 as the coronavirus pandemic weighed on growth and forced cities from London to Singapore into months-long lockdowns.Banks benefited from a favourable trading environment last year as stock markets soared, but also were hit hard as central banks kept interest rates at historic lows to stimulate economies globally.In the first nine months of the year, HSBC's profit fell to US$5.2 billion from US$13.7 billion a year earlier. The bank also recorded US$7.6 billion in so-called expected credit losses because of weakening business activity, nearly four times what it set aside a year ago.New accounting standards adopted by HSBC and its rivals in 2018 require banks to recognise potential credit losses over the life of a loan and more aggressively write down loans if they have experienced a significant increase in credit risk.In October, HSBC said it now expected to reduce its annual costs to below US$31 billion by 2022, a more ambitious target as the company seeks to eliminate 35,000 jobs as part of a massive restructuring.But the bank warned at the time it could still face headwinds from the low-interest rate environment, uncertainty surrounding a resurgence of coronavirus cases globally, Britain's exit from the European Union and geopolitical tensions between Washington and Beijing.HSBC, which generates much of its profit in Asia, is set to report its full-year results in February.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.
Bloomberg•4 days agoCinepolis Enlists Lazard to Save Its Global Web of Posh Cinemas
(Bloomberg) -- Cinepolis de Mexico SA, Mexico’s biggest chain of cinemas, is seeking to restructure more than $1 billion in loans, people familiar with the talks said.The global movie theater giant has enlisted Lazard Ltd. for talks with lenders including Banco Bilbao Vizcaya Argentaria SA, HSBC Holdings Plc, Banco Santander SA and the Mexican government development bank Bancomext, the people said. Talks started early last month and the banks picked FTI Consulting Inc. as their adviser, said the people, who asked not to be identified as the details are private.Representatives for Cinepolis and HSBC declined to comment, while those for Lazard, FTI and the other banks did not immediately respond to requests for comment.Some of the debt includes a 7.5 billion peso ($382 million) term loan due 2023, a $200 million revolver due 2024 and 9.75 billion peso guaranteed term loan due 2026. Combined with obligations tied to operations in India, Brazil and the Middle East, the talks cover $1.35 billion of debt from at least 17 banks, one of the people said.With vaccines rolling out, bankers are more willing to help the family-owned chain survive, the people said. Cinepolis, whose luxury theaters feature extended legroom and serve handcrafted cocktails, has a better chance than some of its peers with higher leverage that have already been restructured, one of the people said.Competitors have grappled for financing wherever possible, as a series of global lockdowns have kept moviegoers at bay, and the rise of streaming services has provided an attractive alternative at home. AMC Entertainment Holdings Inc., the world’s largest movie theater chain, is in talks to raise new money backed by its European cinemas to help it avert bankruptcy, while London-based Cineworld Group Plc obtained a rescue loan from existing creditors in November.Cinepolis, which has locations in the U.S., Spain, India and Brazil, has borrowed over the years to fund a global expansion of high-end cinemas, which have been crippled by the pandemic. It had 862 theaters across 17 countries as of October, according to a company presentation.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg•4 days agoDelivery Hero Raising Up to $1.6 Billion in War Chest for Deals
(Bloomberg) -- Delivery Hero SE is raising as much as $1.6 billion in a share sale, building a war chest for potential deals as the fight to dominate the food delivery market intensifies.The German company will sell as many as 9.44 million new shares in an accelerated offering to bolster its cash position and take advantage of “attractive investment opportunities,” it said in a statement. Delivery Hero has gathered enough orders for all the shares on offer, according to terms of the deal seen by Bloomberg News.Food delivery companies are riding a wave of growth from consumers ordering from home during the coronavirus pandemic, but the sector remains marked by harsh competition and a fight to secure greater market share.Based on the food delivery company’s closing price on Wednesday, it could raise as much as 1.3 billion euros ($1.6 billion). Shares in this type of transaction are usually sold at a discount. The company’s shares were down 3.5% on Germany’s Tradegate exchange compared to Wednesday’s close on the Frankfurt exchange.In late 2019 Berlin-based Delivery Hero, which claims to be the largest food delivery provider outside China, announced plans to take majority control of Korea’s Woowa Brothers Corp. at a $4 billion valuation, expanding its foothold in Asia. The investment would help Woowa go up against SoftBank Group Corp.-funded competitor Coupang, which has also invested aggressively in food delivery.A spokeswoman for Delivery Hero said the Woowa transaction was covered by existing financial resources, adding the new funds are aimed at increasing the company’s financial flexibility more broadly.JPMorgan Chase & Co. and Morgan Stanley are the global coordinators on the share offering, alongside bookrunners HSBC Holdings Plc and UniCredit SpA.(Changes lede, adds comment from spokeswoman)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg•5 days agoChina’s Dreams of Self-Reliance Still Depend on Japan Inc.
(Bloomberg Opinion) -- For signs of how China’s ambitions to become a self-made, high-tech industrial powerhouse are faring, look to Japan Inc.The shipment values of Japan’s machinery sector are set to hit record highs, according to Goldman Sachs Group Inc. analysts. Orders placed by Chinese companies for Japanese machine tools have been rising since June and have picked up pace; same for the sector’s general segment. Sales of factory automation equipment are expected to exceed previous peaks.That's a reversal from the last two years of Chinese rivals grabbing market share as Beijing doubled down on a drive to increase high-end manufacturing, moving away from the mass market, low-margin goods churned out for the last few decades. Chinese makers of all types of machinery and equipment were nudging out typically upper-end Japanese firms, which warned of waning demand from China and uncertainty around it. Meanwhile, the government’s fiscal stimulus helped buoy sentiment for construction-related machinery like hydraulic excavators, where Japanese companies had a firm footing.Not all the pressure came from competitiveness; domestic firms barely stand up against the foreign ones. In 2018, the Ministry of Commerce opened a one-year anti-dumping investigation into Japanese and Taiwanese exporters of vertical-machine centers – key equipment manufacturing facilities for cars and other more sophisticated processes. At the time, as I noted, it was a case of playing spoilsport: The numbers didn't warrant the probe, nor did the impact on prices. Machinery orders had already been slowing, as had shipments for bearings, a proxy for the industry. Citing the complexity, the government extended the case in 2019. By April 2020, it was determined that everything had been fair after all and no duties would be imposed.The change of tack amid the Covid-19 lockdown and subsequent recovery showed the limits of ambitious industrial policy. China has spent much of the last year focusing on policies to become self-sufficient, scarred by the U.S.-induced rebuke over its practices in global trade and rocky rebound out of the pandemic. A key part of Beijing’s economic blueprint for the next five years is to bolster high-end manufacturing of machines, 5G equipment and semiconductors for use in the domestic market. State funding is increasingly being targeted toward these industries. The government also wants to upgrade internal supply chains and maintain its role as the world’s factory floor. China is by far the largest end-user of industrial robots, but the number of robots installed per 10,000 employees remains relatively low. In some sectors like 5G, China has doubtless made significant progress. However, the country will continue to rely on Japanese companies for the high-tech niche of manufacturing for a while to come. Consider this: Chinese suppliers command more than 80% of the market share for simple-task linear and Cartesian robots used in the plastics industry. But when it comes to articulated robots, which have more complex multi-axis movements, foreign makers manufacture droves more in and for China, according to CLSA Ltd. analysts. Such machines accounted for over 60% of sales. Japan is one of the largest exporters of industrial robots. The fact remains that there’s a significant technology gap. More than 75% of reducers, a kind of gear, are imported from Japanese companies like Nabtesco Corp. and Harmonic Drive Systems Inc., according to analysts from HSBC Holdings Plc. These components account for over a third of the cost of industrial robots made in China, compared to 12% for one from Japan. That makes it difficult to be cost-competitive. Chinese companies will have to rely on acquisitions to catch up. For Japan’s machinery giants, that means the trend – and demand – are here to stay. Chinese volumes will drive business and valuations for manufacturers across the sector. Fanuc Corp., whose yellow robots pepper factory floors making products for companies like Apple Inc., reported that sales in China rose 29% in the first nine months of 2020. Despite a seemingly deep Covid-19 slump in Japan’s economy, the Tankan business survey shows that conditions for manufacturers are increasingly upbeat. The TOPIX Machinery sub-index is up 30% since June; the broader stock market has risen only 17%. Companies are likely to invest more in China to leverage the focus on that country’s inward turn.China’s ascent as an industrial technology champion won’t happen tomorrow. Barring the risk of shocks from worsening Covid-19-related lockdowns, though, Japan won’t be losing its long-established preeminence anytime soon. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Anjani Trivedi is a Bloomberg Opinion columnist covering industrial companies in Asia. She previously worked for the Wall Street Journal. For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Bloomberg•13 days agoTesla’s Dominant Position in China Could Be Threatened Next Year
(Bloomberg) -- Tesla Inc. is coming to the end of its first year selling China-made cars with a commanding position in the world’s biggest electric-vehicle market, but Elon Musk shouldn’t rest on his laurels.While Tesla regularly topped monthly premium EV sales tallies this year, helped by the sedans churned out from its multibillion-dollar plant opened to much fanfare in Shanghai last December, 2020 was also marked by rivals catching up. In 2021, the breadth of the competitive attack that Tesla faces will be greater than ever.Whether Tesla can defend its lead in China will be key to its wider growth and earnings trajectory. While still in its infancy, China’s electric-car market dwarfs that of other countries and the government is intent on further expansion amid commitments to reduce fossil-fuel use. Tesla’s fate in China will also show whether it can grow into a truly global carmaker, an ambition investors are banking on after pushing the company’s shares up almost 700% this year.A trio of local champions Nio Inc., Xpeng Inc. and Li Auto Inc. has emerged as the front line against the Palo Alto, California-based company. All traded in the U.S., and enjoying backing from government entities or internet giants, the three startups are quickly winning fans, with sales of their electric SUVs, sedans and crossovers also rising in 2020 and their shares surging on Tesla’s coattails.“Since June, you’ve seen a steady rise in sales by Nio, Xpeng, and Li,” said Bill Russo, founder and chief executive officer of advisory firm Automobility Ltd. in Shanghai. “Can you stay competitive with these fast-moving, internet-backed, very deep-pocketed companies?”China is Tesla’s largest market after the U.S., with sales in Asia’s biggest economy topping 120,000 units this year, according to local registration data. And Tesla keeps ramping up production in Shanghai, prompting analysts to forecast that China will account for a bigger slice of its sales and earnings in the years ahead.The Model 3 sedans Tesla sells in China have higher profit margins than its vehicles in the U.S. and Europe, and China could make up more than 40% of Tesla’s sales by early 2022, Wedbush Securities analyst Dan Ives said in a Dec. 21 research note. That compares with about 20% now.“China could see eye-popping demand into 2021 and 2022 across the board with Tesla’s flagship giga 3 footprint a major competitive advantage,” he said, referring to the Shanghai plant.Expansion PushWaiting in the wings for Tesla is the Model Y, which Musk says has the potential to outsell all other vehicles it makes. The crossover is already being built in California, and a Shanghai-assembled version is clearing the final regulatory stages to start selling in China as soon as next year. Earlier in December, drone footage captured around 40 Model Y vehicles being driven out of the factory and wrapped in protective covers.“China will continue to fuel Tesla’s global growth in 2021, more so than ever,” Sharon Li, a JL Warren analyst, said in a recent note.The carmaker is also expanding its geographic footprint, recently opening multiple Tesla centers in China’s lower-tier cities including Weifang and Linyi in northeastern Shandong province. Meanwhile, it’s bolstering its public and government relations teams in smaller hubs including Shijiazhuang and Haikou, in addition to larger cities.Tesla is starting local production of chargers in Shanghai too, part of an effort to expand its charging network in more cities. The company recently completed its 500th super-charging station, marching toward an annual target of 650.Crowded FieldTrade group China Passenger Car Association predicts that Tesla will sell as many as 280,000 vehicles in the country next year. While that represents impressive growth over 2020, it would still leave more than 80% of the market up for grabs. PCA predicts total sales of 1.7 million new energy vehicles for 2021.That means local premium brands Nio, Xpeng and Li are increasingly a threat -- combined, the three companies already approach Tesla’s monthly sales tally. SAIC-GM Wuling Automobile Co. and BYD Co., which sell less expensive electric cars, are also gaining momentum.Nio, the biggest of the Chinese trio, has steadily boosted sales of its electric SUVs that it sells at a price as much as 40% higher than Tesla’s Model 3. The company’s retail strategy includes clubhouses with showrooms, lounges, work spaces, theaters and even camp activities for customers’ children. A Tesla price cut earlier in the year added some pressure, but a subsequent reduction failed to have a similar impact, Nio CEO William Li said on a recent earnings call.“We didn’t see any specific impact on our order intake,” Li said. “This proves that we have our own unique advantages.”Xpeng similarly has seen brisk sales growth, helped by lower prices than Tesla’s. The company, which touts the smart features of its vehicles, raised $2.2 billion this month selling additional stock, capitalizing on a recent share-price surge.“I would call 2020 Year One of an intelligent electric-vehicle market in China,” Xpeng Vice Chairman Brian Gu said in a phone interview on Nov. 27. “We’re seeing really good sales of many good products.”Common EnemyBut Tesla and its Chinese rivals also face a common threat: conventional carmakers swiftly moving to electrified autos. Volkswagen AG plans to introduce eight ID series electric models in China by 2023, while Daimler AG, the maker of Mercedes-Benz luxury cars, has launched the EQC electric SUV and plans to expand its lineup of purely battery-powered vehicles to at least 10 in coming years. While their EV volumes in China are still small -- they’ve yet to break into the Top 10 -- the traditional giants have the advantage of vast dealership, service and supply-chain networks.China’s government, meanwhile, is doing its best to lure consumers and old-school automakers away from gas guzzlers with subsidies and restrictions. The target is to have NEVs account for 20% of the market by 2025, up from about 5% currently.Tesla will have its work cut out to ensure it’ll be among the beneficiaries of that push. Lu Bin, a fund manager at HSBC Bank (China) Co. and an early buyer of a China-built Model 3 sedan, said he opted for a roomier Li Auto model when he purchased a new EV in November. The range is better, plus the six-seater is more suitable for families.“Tesla had the early-mover advantage and has shown the way to consumers,” said Russo. “But now, there are more options.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
South China Morning Post•14 days agoHSBC, Deloitte, Sun Hung Kai Properties among firms offering Greater Bay Area work experience to Hong Kong youth
Banks, accounting firms, insurers and property developers in Hong Kong are offering youngsters incentives to work in the Greater Bay Area development zone, industry players said.These organisations see the better connectivity between Hong Kong and the mainland cities that are part of the zone as boosting their bottom lines in the future and want to hire more young people to work there.The Hong Kong government too hopes the city's status as an international financial hub will help boost growth throughout the Greater Bay Area and provide opportunities for the city's youth, who are facing a challenging employment environment following months of anti-government protests and the coronavirus pandemic. The city's unemployment rate among those aged 15 to 25 stood at 18.2 per cent as of July, according to government data.Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.In her policy address on November 25, Hong Kong leader Carrie Lam Cheng Yuet-ngor announced a new youth employment scheme that encourages companies to recruit local graduates to work in the Greater Bay Area, a hotbed of innovation and technology. The scheme is expected to provide 2,000 placements.HSBC, the biggest lender in the city, said this month that it would grant up to HK$8 million (US$1.03 million) for scholarships over the next three academic years for up to 100 Hong Kong undergraduates who want to work or study in the region. It is inviting applications from 12 universities and tertiary institutions in Hong Kong."As an economy, the Greater Bay Area is the 12th largest in the world," HSBC's Asia-Pacific chief executive Peter Wong Tung-shun said in a December 14 statement. "The demand for talent will only grow exponentially, as businesses become more digital, innovative and seek to incorporate the latest technologies while transitioning to a green economy."The cluster of 11 cities, with a combined population of 72 million residents and an economy estimated at US$1.65 trillion, provides a potential market 10 times the size of Hong Kong's.HSBC, which describes itself as the largest foreign bank in the Greater Bay Area, broke ground in March on a 16,000 square metre global training centre in Nansha, in Guangzhou province, which is expected to be completed in 2024.Bank of China (Hong Kong) has also been involved in a variety of government-backed internship and exchange programmes that help Hong Kong youngsters experience the mainland. It has also funded charitable organisations to create career development projects for Hong Kong youngsters to work in the Greater Bay Area. A spokesman said these projects offer more than 110,000 spots in total.Standard Chartered said it was rotating fresh graduates in its international graduate programme to the Greater Bay Area. The bank is investing US$40 million in a new Greater Bay Area centre in Guangzhou while it is targeting having more than 1,600 staff there by 2023, including young talent from Hong Kong.The Bank of East Asia, meanwhile, offers young Hongkongers a chance to join its management trainee programme and work in its branches in the nine Greater Bay Area cities.Besides banks, some of the Big Four accounting firms also want to hire more Hong Kong youngsters to work in their Greater Bay Area branches."Every year, Deloitte hires more than 600 new graduates within the Greater Bay Area," Dennis Chow Chi-in, chairman of Deloitte China, told the South China Morning Post.Dennis Chow Chi-in, the chairman of Deloitte China. Photo: Edmond So alt=Dennis Chow Chi-in, the chairman of Deloitte China. Photo: Edmond So"We echo [Carrie Lam's] remarks that the Greater Bay Area presents huge opportunities for the development of various sectors in Hong Kong," Chow said, added that Deloitte would fully support the scheme to provide opportunities for youngsters in the area.The firm set up The Deloitte Greater Bay Area Centre in Shenzhen in 2019 to serve the many innovative entrepreneurs in the city. The city was home to 25 of the Greater Bay Area's 43 unicorns last year. And half of all patents filed in China are from Shenzhen.EY, another Big Four accounting and consultancy firm, signed a talent-exchange programme strategic agreement with the Shenzhen Luohu District government on December 18, committing to jointly promote talent growth in the Greater Bay Area."EY is committed to building a better working world by helping young people develop their careers and broaden their horizons," Agnes Chan, the Hong Kong and Macau managing partner at EY said in an interview. "We launched our Greater Bay Area Youth Mobility Programme in August this year to offer internships to university students in EY offices in the Greater Bay Area".Hong Kong's insurance companies are also seeking Hong Kong young that is willing to go north. As part of the Greater Bay Area development plan, Beijing has agreed to let Hong Kong insurers set up three customer service centres in the area in the near future.Eric Hui Kam-kwai, the chairman of the Hong Kong Federation of Insurers. Photo: Jonathan Wong alt=Eric Hui Kam-kwai, the chairman of the Hong Kong Federation of Insurers. Photo: Jonathan Wong"When the customer service centres are established in the Greater Bay Area cities for our industry, more talent will have opportunities to work there," said Eric Hui Kam-kwai, chairman of the Hong Kong Federation of Insurers (HKFI), an industry body. "As we integrate into the Greater Bay Area, we will look into any programmes that promote exchange and learning for youngsters," Hui said.Sun Hung Kai Properties, Hong Kong's biggest developer by value, has many large-scale projects in Greater Bay Area cities such as Guangzhou, Zhongshan, Dongguan and Foshan."We will support and take part in the Hong Kong government's Greater Bay Area Youth Employment Scheme. Upon its launch, some of our young colleagues will be deployed to work in the Greater Bay Area on our projects," a spokesman said.The developer has since 2006 recruited both Hong Kong and mainland university graduates for its management trainee programme, he added.Additional reporting by Jack LauThis article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.
- Bloomberg•19 days ago
Mark Zuckerberg Has Another Answer to Bitcoin
(Bloomberg Opinion) -- Last year’s backlash against Facebook Inc.’s planned digital currency Libra would have been most CEOs’ worst nightmare.Governments and regulators linked arms to repel a perceived threat to monetary sovereignty, financial stability and data privacy. The more Mark Zuckerberg tried to reassure politicians by talking up financial inclusion and innovation, the more he came across like a tobacco boss denying cigarettes are addictive. He even acknowledged the problem: “I get that I’m not the ideal messenger for this.”That hasn’t deterred him. Given Zuckerberg’s tendency to issue half-hearted apologies before going back to breaking things, it’s not surprising that he’s gearing up for a second attempt to launch Libra next year.There have been a few changes: Libra is now called Diem – as in Carpe — and its membership council is headed by Stuart Levey, whose stints at the U.S. Treasury and HSBC Holdings Plc make him a blend of Beltway and banking. There’s no more talk of rewards for members in the form of “investment tokens.”Technically, Facebook is only one of Diem’s 27 members, and Diem says it’s an independent organization — Facebook will be providing an electronic wallet alongside it. But this project was created and funded by Zuckerberg’s company, and the association’s six-seat board includes David Marcus, head of Facebook’s cryptocurrency efforts. The biggest new concession to regulators is that Facebook will no longer create a single global currency. Rather than craft a synthetic Libra out of a basket of euros, dollars and yen — much like the International Monetary Fund’s Special Drawing Rights — Diem will be made up of multiple single-currency stablecoins, pegged to each one. Converting a dollar or euro into a digital Diem would be a one-to-one transaction, with little chance of wild Bitcoin-level volatility or an overnight disruption of fiat currencies.Facebook is even proposing that central banks one day use the Diem blockchain to issue digital currencies, similar to China’s testing of a digital yuan.This plea for legitimacy suggests Facebook is leaning more toward the kind of electronic cash offered by PayPal Holdings Inc. or Alibaba Group Holding Ltd., than the revolutionary crypto dreams of Bitcoiners. A digital dollar that’s transferable anywhere and at any time could in theory be a draw for consumers (even if in practice it’s regulation, rather than technology, that’s the cause of transaction slowness). Teunis Brosens, a senior economist at ING, reckons Diem may end up like a plain-vanilla “e-money” wallet. Blockchain expert David Gerard has called it “Paypal-but-it’s-Facebook.”It’s the “it’s-Facebook” part that should keep governments on their guard. E-money firms are often start-ups with Visa cards. Facebook, together with its WhatsApp and Instagram platforms, boasts 3 billion monthly users. If they each generate $6 in sales, Diem would represent an $18 billion revenue stream overnight.After U.S. regulators this month accused Facebook of unfairly abusing its market power to monopolize social media, will it compete fairly in this new arena or squash the competition? Imagine if Facebook’s ad contracts were one day tied to Diem, or if it abused its access to customers’ financial data. Trustbusters will be glad Libra didn’t lift off earlier.It’s likely more regulation is needed. As German Finance Minister Olaf Scholz put it, referring to Libra’s name change, “a wolf in sheep’s clothing is still a wolf.” The noose is already tightening around such stablecoins with Europe imposing more bank-like capital requirements, says Simon Polrot, head of crypto-development non-profit ADAN. If it takes off, regulators might also want an inside peek into how Diem manages its cash reserves. As for money-laundering risks, Zuckerberg will no doubt sign up to “know your customer” rules, but how effective will Facebook be in tackling bad actors? And will it enforce the U.S.’s extraterritorial sanctions?Lawmakers may wonder whether Facebook needs a banking license, something it really doesn’t want. Zuckerberg will no doubt argue that Diem is an association, independent of his empire. But it resembles a Potemkin village populated by payments firms, non-profits and venture capital funds. There are no banks, and none of the other FAANGs. Those who left Libra, such as PayPal, haven’t returned.No one should underestimate Zuckerberg’s determination to launch this product. In the face of widespread criticism, he is coming back for more and Marcus. his top financial-services executive, is asking for “the benefit of the doubt” from regulators. That line wouldn’t work in a car-repair shop, let alone a bank. Still, Facebook deserves a fair hearing, given Zuckerberg has changed Libra’s message. If it falls on deaf ears, maybe the problem is the messenger.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Lionel Laurent is a Bloomberg Opinion columnist covering the European Union and France. He worked previously at Reuters and Forbes.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Bloomberg•24 days agoNew Zealand Economy Surges Out of Recession In V-Shaped Recovery
(Bloomberg) -- New Zealand’s economy bounced back strongly from recession in the third quarter, achieving a so-called V-shaped recovery as massive fiscal and monetary stimulus fueled consumer spending.Gross domestic product surged 14% from the second quarter, when it contracted a revised 11%, Statistics New Zealand said Thursday in Wellington. Economists forecast a 12.9% gain. From a year earlier, the economy grew 0.4%, confounding the consensus forecast for a 1.8% decline.New Zealanders have gone on a spending spree since the nation eliminated community transmission of Covid-19 in May and then successfully contained sporadic outbreaks. However, the border remains closed to foreigners, crippling the tourism industry, and many businesses have put investment and hiring plans on hold, which is projected to push the jobless rate higher in 2021.The V-shaped economic rebound is “vindication of the Covid-19 ‘elimination’ strategy New Zealand has pursued, as it has underpinned a strong economic recovery from what has been an unprecedented shock,” said Paul Bloxham, chief Australia and New Zealand economist at HSBC in Sydney. Still, “closed international borders to people movement are weighing on tourism and other services exports, and are set to continue to do so for some time.”The New Zealand dollar rose after the GDP report and bought 71.29 U.S. cents at 3:52 p.m. in Wellington. The currency has gained 5.5% the past three months, and was appreciating ahead of the release after Prime Minister Jacinda Ardern announced plans to offer Covid-19 vaccines to the entire population in the second half of 2021.The economy’s quick rebound to pre-Covid levels was a rare feat, said Stephen Toplis, head of research at Bank of New Zealand in Wellington. “We can only identify three other countries that have achieved the ‘full recovery’: Taiwan, China and Ireland,” he said. “New Zealand is definitely in a very small minority.” The government’s determination to eliminate the virus saw it impose one of the strictest lockdowns in the world but allowed a quicker resumption of economic activity once it was stamped out. New Zealand has recorded 1,744 confirmed cases of Covid-19 and just 25 deaths.A fresh community outbreak in mid-August required a second, six-week lockdown in largest city Auckland, but the country has fared better than many of its peers. U.K. GDP fell 9.6% in the third quarter from a year earlier, while Australia’s fell 3.8%.The government pledged NZ$62 billion ($44 billion) of fiscal support to help revive domestic demand and protect jobs, while the central bank has slashed interest rates and embarked on quantitative easing and term lending programs to further drive down borrowing costs.That’s put a rocket under the housing market, with prices soaring to fresh records.Still, the Reserve Bank and some economists have cautioned the economy may contract in the fourth quarter and even face a double-dip recession early next year, citing slower global growth and the possibility that the border will remain closed to most visitors until at least the second half of 2021.Other DetailsThe third-quarter expansion was driven by construction and services industries -- in particular retailing, accommodation and restaurants, the statistics agency said.Manufacturing output rose 17% from the second quarterConstruction jumped 52%Household consumption increased 14.8% led by cars, televisions and domestic air travelInvestment surged 27% led by residential buildingExports rose 4.9%, while imports gained 10.6%GDP per capita climbed 13.8%(Updates with economist comment in fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Bloomberg•26 days agoSweden’s Second Wave Offers Hard Reality Check
(Bloomberg Opinion) -- Every country has at one point dared to believe they’ve figured out how to beat SARS-CoV-2, until reality sets in.The U.K.’s misguided flirtation with a hands-off “herd immunity” strategy in March led quickly to a U-turn and tough restrictions. France and Spain promised they’d never repeat the draconian lockdowns they imposed early on — only to break their vow when test-and-trace systems failed to keep pace with summer vacation contagion. Israelis, who after a first lockdown were told to enjoy life and “have a beer,” are now facing a third one. Donald Trump recently claimed he’d ended the pandemic (he hadn’t).Now, it’s Sweden’s turn. After a summer lull, the Scandinavian country famous for its voluntary “trust-based” approach to social distancing is getting battered by a winter wave of the coronavirus. Its 7-day average of daily cases and deaths per capita is currently outpacing the U.K., France and Spain, and isn’t far off the U.S.’s tallies. While Sweden’s total deaths of 7,514 are on a per-capita basis lower than those countries, they far outstrip its Nordic neighbors at five times Denmark’s rate, nine times Finland’s and 10 times Norway’s.The aura of calm that Swedes have projected is fading as a result. With intensive-care beds in Stockholm almost full, Prime Minister Stefan Lofven gave a recent gloomy television address — a historically rare occurrence — imploring citizens to follow tough new restrictions to alleviate overstretched hospitals and save Christmas. Public gatherings are capped at eight people; schools have been shut, some for the first time; alcohol sales are banned after 10 p.m. While much is still recommendation rather than rule, Sweden’s government has proposed a law that would give it the power to close stores in response to a worsening pandemic. This doesn’t come close to the widespread business closures seen elsewhere or the bureaucratic form-filling of France’s lockdowns. But it's a sign that whatever was working in Sweden isn’t doing the trick anymore. Though the country suffered a high death rate during the first wave, there was optimism it was an upfront cost in return for less economic pain and higher immunity levels — all while respecting, and even reinforcing, a fabric of social trust. Sweden’s economy at the end of September was only 2.2% smaller than it was in 2019, according to HSBC. But the new wave is a nasty development.It’s tempting to gloat over Sweden’s failures and the attitude of its top epidemiologist, Anders Tegnell, who is by turns curiously inflexible (he opposes face masks) and unpredictable (his U-turns on guidelines for children). But maybe Sweden is simply falling into the norm for this public health crisis. After all, Germany, a bright spot of Europe earlier this year, is going through a similar reversal of fortunes. Its daily deaths are hitting their highest levels since the start of the pandemic, prompting Chancellor Angela Merkel to call on Germans to rein in Christmas celebrations in an emotional speech. Switzerland, too, is being hit harder this time around.The reality is that all countries have had to learn from mistakes. Data estimating the strictness of Covid-19 restrictions around the world suggest countries like Italy and France have softened their lockdown approach since April, keeping schools open for example. Giuliano di Baldassarre, a professor of crisis management at Uppsala University, reckons the lessons have gone both ways: Sweden has taught other countries to consider more humane and more stable restrictions, but it has also been taught that a lack of legal or regulatory intervention can become a problem.As countries from the U.K. to Croatia tighten restrictions ahead of the holidays, the ideal of a European “model” for keeping the virus in check is looking increasingly unattainable — and that includes the Swedish model, the focus of such fascination earlier this year. It would have been hard to replicate the Scandinavian country’s natural advantages, such as a high rate of remote work and single-occupant households, elsewhere. Now it seems the country’s popular commitment to social distancing is suffering from fatigue, as elsewhere. Until vaccines get rolled out at scale, the danger for people everywhere will be imagining they’ve got this virus beaten.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Lionel Laurent is a Bloomberg Opinion columnist covering the European Union and France. He worked previously at Reuters and Forbes.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The Telegraph•28 days agoSenior staff at HSBC, Standard Chartered and Deutsche Bank are Chinese Communist Party members
Hundreds of senior employees at British banks HSBC and Standard Chartered have been members of the Chinese Communist Party, according to documents seen by The Telegraph. The lists show that at least 335 HSBC employees were CCP members. Current members include the senior vice-president of HSBC China, the president of HSBC’s Shenzhen office and the deputy manager of Hong Kong corporate and consumer products are listed as members. Standard Chartered has employed at least 290 CCP members. Among active members who have pledged an oath of loyalty to the country’s ruling party are the deputy president of the bank’s Chinese subsidiary, head of investment management and head of business banking. The names were revealed in a leaked database of nearly 2 million registered party members that highlights the full extent of Beijing’s influence. The Telegraph conducted its own research to assess whether senior employees still worked for the banks. The revelation is likely to heap further pressure on the lenders, who have found themselves in the crossfire as trade relations between the US and China have deteriorated. HSBC in particular has struggled to navigate the conflict between being headquartered in the UK but relying on China and Hong Kong, which has imposed a new security law to crack down on protestors, for most of its profits. In recent months there has been an increased pressure internationally on China over human rights abuses. Foreign Secretary Dominic Raab condemned “serious and egregious” human rights abuses, and refused to rule out a boycott of the 2022 Winter Olympics which will be hosted in the country. Senior employees of a variety of UK and US companies appear on leaked membership lists seen by The Telegraph. Premier League football club Wolves are also revealed to be owned by party members, including one owner who holds a position of responsibility within the party. Further questions are also set to be posed about Huawei’s supply chain, as the company’s sole American manufacturer Qualcomm are revealed to employ hundreds of party members including some in senior positions. US Secretary of State Mike Pompeo claimed the Chinese state had “bullied” HSBC into blocking accounts of pro-democracy supporters in August.Earlier this month, HSBC froze the account of exiled pro-democracy activist Ted Hui, which sparked further criticism from activists. HSBC and Standard Chartered have both announced their public support for Hong Kong’s national security law, alongside Standard Chartered. Dong Shuyin, deputy president of Standard Chartered in China, has won awards within the CCP, including “Excellent Communist Party Member in Shanghai”. Mr Dong met with Chinese President Xi Jinping during a visit in 2019, where the two discussed the growth of the party. Mr Dong had described the CCP as an “indispensable part of [Standard Chartered’s] development in China”. Two senior Deutsche Bank managers were also listed as party members. JP Morgan Chase also has party members in senior positions within their organisation, including an executive director who joined from HSBC.
Zacks•last monthUK Regulators Allow Banks to Resume Shareholder Distribution
As U.K. bank regulators allow restart of shareholder distribution, HSBC Holdings (HSBC), Barclays (BCS), Lloyds (LYG), NatWest (NWG) & Standard Chartered (SCBFF) are likely to announce the same soon.
South China Morning Post•last monthHSBC, Standard Chartered likely to resume dividends next year after UK regulator gives OK
HSBC and Standard Chartered could restart their dividends as soon as early next year after their chief financial regulator in the United Kingdom said it felt comfortable with the country's biggest lenders resuming payouts as economies continue to recover from the fallout of the coronavirus pandemic.The announcement sent the shares of both banks higher early in Hong Kong's trading session on Friday, but their shares gave up much of their gains over the course of the day. HSBC's shares declined 0.6 per cent to close at HK$41.65 (US$5.37), while Standard Chartered's shares rose 0.2 per cent to end the day at HK$49.The banks, which are based in London, but generate much of their revenue in Asia, were among six UK lenders who agreed earlier this year to cancel their final 2019 payments and suspend further dividends and share buy-backs this year as part of a coordinated response following a request by the Prudential Regulation Authority (PRA), a regulatory arm of the Bank of England.Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.While economic uncertainty as a result of the pandemic remains "high" and banks in the UK are likely to face "some headwinds" in their capital positions next year, the PRA said it believes lenders remain well capitalised and able to support the economy."Weighing those considerations, and consistent with the PRA's view that distributions are an important and necessary part of the functioning of the banking system, the PRA judges that an extension of the exceptional and precautionary action taken in March is not necessary and that there is scope for banks to recommence some distributions should their boards choose to do so, within an appropriately prudent framework," the PRA said in a statement early on Thursday.The move to suspend payouts sparked a rebellion among the Hong Kong shareholder bases for both HSBC and Standard Chartered with some investors calling for the lenders to ditch their London headquarters in favour of Hong Kong.HSBC, which moved its headquarters to London following its acquisition of Midlands Bank in 1992, has previously said it would not consider moving its headquarters after reviewing its domicile four years ago.Both banks saw their shares hit hard by investors following the cancellation of their final 2019 dividends and suspensions of further payouts this year, with HSBC hitting a 25-year low in September.Concerns among investors also were high earlier this year as both lenders were forced to set aside billions of dollars in reserves for potential soured loans as the pandemic weighed on economies stretching from Hong Kong to London to New York.Those worries have subsided somewhat in recent weeks as Asian economies, particularly in China, appear to be recovering at a quicker pace than their Western counterparts and positive news emerged on the roll-out of a coronavirus vaccine.China is the only major economy expected to grow this year, according to the latest forecast from the International Monetary Fund, which is predicting a "long, uneven, and uncertain" global recovery. However, Hong Kong, the biggest market for both HSBC and Standard Chartered, is in the throes of the "fourth wave" of the outbreak."We welcome this decision by the PRA," Standard Chartered said in a statement. "Given our strong capital position the board will consider resuming shareholder returns on 25 February 2021 when we release our full-year 2020 results."As of Thursday's close, HSBC's shares recovered nearly all of their losses since April 1, when the dividend suspension was announced, and Standard Chartered's shares are trading above their late March levels.HSBC has said it expects to pay a "conservative" dividend for 2020 depending on market conditions. Photo: Xiaomei Chen alt=HSBC has said it expects to pay a "conservative" dividend for 2020 depending on market conditions. Photo: Xiaomei ChenBoth banks could see a more than 20 per cent upside in their stocks if they are able to return to paying dividends in 2022 that are in line with their average between 2014 and 2018, Goldman Sachs said in a research note last week.For now, HSBC and Standard Chartered have said they would consider restarting dividends when they report their full-year results in February, depending on their performance to finish the year and the economic outlook. HSBC has said any payouts would be "conservative", with an eye to increasing them in the future.The banks reported better-than-expected earnings in the third quarter, with HSBC saying it now expects to take provisions for bad loans at the "lower-end" of a range of US$8 billion to US$13 billion that it forecast in August.The PRA said any decision on the appropriate levels of distributions remains up to the bank boards, but the regulator asked banks to operate within a framework of "temporary guardrails" for 2020.The regulator said that distributions to shareholders should not exceed 20 basis points of risk-weighted assets at the end of the year or 25 per cent of cumulative profits for all of 2019 and 2020 after deducting prior shareholder payouts.It also asked that banks "exercise a high degree of caution and prudence" in determining the size of any cash bonuses to senior staff after requesting earlier this year that banks not pay cash bonuses to senior executives and material risk takers."Any distributions should be prudent, reflecting the still elevated levels of economic uncertainty and the need for banks to continue to support households and businesses through the continuing economic disruption, even in the event that this disruption is more prolonged and severe than currently anticipated," the regulator said.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.
Business Wire•last monthNotice of Redemption
HSBC Holdings has given notice of redemption and cancellation to The Bank of New York Mellon as the holder of the Issuer’s Preference Shares
Insider Monkey•last monthIs HSBC A Good Stock To Buy Now?
Most investors tend to think that hedge funds and other asset managers are worthless, as they cannot beat even simple index fund portfolios. In fact, most people expect hedge funds to compete with and outperform the bull market that we have witnessed in recent years. However, hedge funds are generally partially hedged and aim at […]
- Business Wire•last month
HSBC Holdings plc Announces a Proposed Offering of Additional Tier 1 Securities to Finance the Redemption of Its US Dollar Preference Shares
HSBC Holdings announces the potential launch of an offering of a series of USD-denominated perpetual subordinated contingent convertible securities
South China Morning Post•last monthEarly Christmas gift? HSBC stock could climb further if bank is allowed to reinstate dividend this week: Goldman
Eight months after HSBC suspended its dividend, its shareholder base in Hong Kong appears to have fallen in love again with the biggest of the city's three currency-issuing banks.Battered by the dividend cancellation and increasing concerns about how a poor economic outlook and worsening US-China relations could weigh on its results, the London-based lender's shares hit a 25-year low in September.Just over two months later, however, the bank's prospects - and its share performance - are looking up. As of Friday's close, its stock in Hong Kong had risen 54 per cent from its September lows, and regained nearly all of its losses since April 1, when it cancelled its final 2019 dividend and suspended its dividends this year at the request of its primary regulator in the United Kingdom.Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.The bank's stock could go even higher if an arm of the Bank of England (BoE) agrees to allow HSBC and its Hong Kong rival, Standard Chartered, to resume dividends later this month, according to Goldman Sachs."The [BoE's] decision could be a positive catalyst, which could make dividend/capital returns an 'invest'-able theme at the two banks (again)," Goldman analysts Gurpreet Singh Sahi and Martin Leitgeb said in a research report on Friday.The Bank of England could decide as soon as December 11 if it will allow HSBC and its Hong Kong rival Standard Chartered to resume paying dividends, according to Goldman Sachs. Photo: Felix Wong alt=The Bank of England could decide as soon as December 11 if it will allow HSBC and its Hong Kong rival Standard Chartered to resume paying dividends, according to Goldman Sachs. Photo: Felix WongThe BoE could allow UK-based banks to resume paying dividends as soon as December 11, when the central bank releases its latest financial stability report, according to Goldman.That could lead to a more than 20 per cent upside in HSBC and Standard Chartered's stocks, if the two banks were able to pay an annual dividend in 2022 equal to their four-year average from 2014-2018, the Goldman analysts said. Any dividend for 2020 is likely to be small - US$0.15 a share for the second half of the year, the analysts said.In October, HSBC said that it may pay a "conservative" dividend for the full year after executives were encouraged by its performance in the first three months of the year, and the improved economic outlook for 2021.The company reported a better-than-expected third-quarter profit and said that it expected to make provisions for potential soured loans from the economic fallout of the coronavirus pandemic at the "lower end" of a range of US$8 billion to US$13 billion that it forecast in August. However, any payout would depend on economic conditions early next year and discussions with regulators."We know that dividends are important to all of our shareholders and we want to restart paying dividends as soon as we can and build from there," Noel Quinn, the bank's chief executive, said in October.HSBC declined to comment for this story.A return to payouts would be a welcome relief for the bank's Hong Kong investors, who have been sorely tested this year.Amid a rebellion among HSBC investors in its biggest market in April, Fong appealed on behalf of more than 500 retail shareholders to the Securities and Futures Commission to act to safeguard the interests of local investors.China is continuing to promote reform and opening up, and strive to create a better business environment, which will create more opportunities for international businesses, including HSBC. @HSBC_UK https://t.co/w1IIA6Yh3r\- Liu Xiaoming (@AmbLiuXiaoMing) October 20, 2020"However, there are some investors who may [have sold] their HSBC shares and they will not be compensated," Fong said in a telephone interview on Friday. "Overall, we urge HSBC not to suspend paying the dividend in future, as it should take care of the interests of its loyal Hong Kong shareholders."Under Quinn, the bank has become even more reliant on Asia, as it makes a big bet on future growth in China and the Greater Bay Area. However, it has faced a challenging year as the lender has found itself increasingly caught in the middle of rising tensions between the world's two biggest economies.American officials criticised HSBC over its support of a controversial national security law adopted by Beijing for Hong Kong in June. And mainland media reported the lender could be placed on an "unreliable entities" list over help it provided to US prosecutors in an investigation of Chinese telecommunications company Huawei Technologies.HSBC and its Hong Kong rivals are facing a difficult operating environment as they navigate historically low interest rates. Photo: Sam Tsang alt=HSBC and its Hong Kong rivals are facing a difficult operating environment as they navigate historically low interest rates. Photo: Sam TsangThose threats seemed to have subsided somewhat as Liu Xiaoming, China's ambassador to the UK, pointed in a tweet in October to HSBC as an example of how China was opening up its markets to foreign businesses. The bank was also among a dozen lenders to manage China's latest sovereign bond sale last month.But HSBC and its Hong Kong rivals still face a challenging operating environment. Interest rates are expected to remain at historic lows for years, and the city's economy has been slow to recover from months of anti-government protests last year and the fallout from the pandemic, pressuring their bottom lines and prompting lenders to consider more fee-based products.Hong Kong's economy is expected to contract by a record 6.1 per cent this year."If HSBC and Standard Chartered Bank resume paying a dividend, certainly it will help give a small boost to their stock prices," said Robert Lee, the vice-chairman of Hong Kong Securities Association. "It is hard to imagine a very big jump, especially in the current low-interest environment."The big question for investors is how much capital HSBC and its rivals will be able to return as they navigate an uncertain environment next year."Last year, HSBC distributed HK$4 per share in dividends. If it pays HK$1 of dividend next year, I think it can support a rebound in its share price to the HK$50 level," said Francis Lun Sheung-nim, the CEO of GEO Securities. "Standard Chartered may see an even stronger rebound, given its share price's discount to its book value is steeper than that of HSBC."This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.
Bloomberg•last monthU.S. Is Said in Talks to Resolve Charges Against Huawei CFO
(Bloomberg) -- The U.S. Justice Department is in talks about a possible resolution in the legal case against the chief financial officer of Huawei Technologies Co., according to a person familiar with the matter, a simmering dispute that has fueled a clash between the world’s two biggest economies.No deal or terms have been reached in the discussion about the fate of Meng Wanzhou, said the person, asking not to be identified because the matter is private.Justice officials and lawyers have discussed the prospect of a deferred prosecution agreement related to wire and bank fraud charges, which would allow Meng to return home to China from Canada in exchange for admitting wrongdoing in the criminal case, Dow Jones reported earlier, citing people familiar with the matter. She was arrested two years ago in Vancouver and has been confined to the city since then.The Trump administration’s moves against Huawei -- particularly the arrest of Meng, the daughter of founder Ren Zhengfei -- have added to the rising tensions between the U.S. and China. In addition to the legal case, the U.S. government has pressed allies to bar their telecom carriers from using the company’s networking equipment because of alleged security risks.Meng has so far resisted the proposal because she believes she has done nothing wrong, Dow Jones reported. The U.S. claims Meng tricked HSBC Holdings Plc into processing Iran-linked transactions that put the bank at risk of violating American sanctions.A DOJ spokesman and Huawei representatives declined to comment. Meng’s lawyers didn’t immediately respond to requests from Bloomberg News. A spokeswoman for Canada’s Justice Minister David Lametti said, “As the matter remains before the courts, it would be inappropriate to comment further.”China’s foreign ministry reiterated its contention that Meng was innocent and called on both U.S. and Canadian authorities to drop proceedings against her.“The U.S., to achieve the political purpose of containing Chinese high-tech companies, orchestrated this case, and the Canadian side played its accomplice,” Foreign Ministry spokeswoman Hua Chunying told reporters during a regular news briefing on Friday. “It is 100% a political incident.”An agreement about the Huawei CFO could remove an issue that has damaged the China-Canada relationship and pave the way for the return of two Canadians who were detained in China after Meng’s arrest, Dow Jones said.Negotiators for Meng and the Justice Department will speak again this week in hopes of reaching a deal before Donald Trump leaves office, the news service reported. Huawei officials are also holding out hope that Joe Biden’s administration will be more lenient, the report said.(Updates with comment from China’s Foreign Ministry from seventh paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Business Wire•last month
HSBC USA Observes #GivingTuesday with $400,000 In New Contributions to Feeding America, American Red Cross and to Address Evictions Crisis
HSBC Bank USA kicks off the year-end giving season with announcements on Giving Tuesday of increased contributions to organizations providing humanitarian relief from a number of crises impacting American this year, including economic disruptions caused by the COVID-19 pandemic, and the wildfires on the Pacific coast.
Bloomberg•last monthItalian Banking Is Hard Work for a Frenchman
(Bloomberg Opinion) -- In Europe’s embattled banking industry, few chief executive officers can claim to have made as meaningful a mark on their business as Jean Pierre Mustier at UniCredit SpA. Unfortunately for him, running a national banking champion — especially during a pandemic, and especially in Italy — also requires a high degree of political savvy.That Mustier’s future at UniCredit is coming to an abrupt end doesn’t say much about his plans for the lender, nor his abilities; it is more about the role an increasingly interventionist Italy would like its banks to play.In his four years running the bank, the French CEO has dramatically reduced a mountain of bad debt, improved efficiency and sold non-core assets. Just before the pandemic hit, UniCredit was in good enough health to plan a significant boost to shareholder payouts, finally reaping the rewards of his turnaround. True, Mustier got rid of higher-growing businesses and burned through a massive capital raise. And the shares were still languishing, trailing behind its bigger Italian peer, Intesa Sanpaolo SpA. But his decisiveness and ability to deliver on financial targets had even attracted the attention of HSBC Holdings Plc, which considered Mustier as CEO. Surely the Italian lender should be bending over backward to keep him.And yet, as Mustier tries to revive the bank’s profitability after the shock of the pandemic, he finds that Italy’s Treasury and other parts of the government are the stakeholders he needs to please, not ordinary shareholders. Italy is eager for UniCredit to become a white knight for ailing Banca Monte dei Paschi di Siena SpA, and Mustier — naturally enough — isn’t so keen. That has cost him his job. The CEO on Monday informed the bank he will leave in April citing a clash of opinion with the board on the firm's strategy.Taking over Monte Paschi is a distraction UniCredit could do without, even if it comes with a large state subsidy to cover the costs and any capital shortfall. The combination wouldn’t give UniCredit a better position in Lombardy, Italy’s economic engine. And it might get in the way if a more appealing international target came along. Strategically, the Italian bank would be better off buying Commerzbank AG, boosting its already considerable presence in Germany.But it’s becoming clear that the Italian state wants to put domestic considerations back at the heart of the bank’s strategy. The appointment last month of Pier Carlo Padoan, Italy’s finance minister at the time of Paschi’s nationalization, as UniCredit’s next chairman showed the direction of travel. As my colleague Ferdinando Giugliano has noted, Rome has been reversing a decades-long shift on letting the markets take care of its businesses, and is now pursuing a more interventionist approach.While this is troubling, there is also an argument that Mustier’s reluctance to grow the business in Italy could hurt strategically. Intesa’s purchase of smaller rival UBI Banca SpA has reinforced its dominant market share, hampering UniCredit’s ability to dictate prices and keep the best clients. France’s Credit Agricole SA is also buying a smaller Italian lender to bulk up in the country. Mustier’s insistence that the bank should shun domestic M&A for now may not pay off as the rest of the industry consolidates around him.For Mustier, running the bank purely for financial returns was always going to be difficult for an outsider. For investors, the hope must be that UniCredit doesn’t sacrifice talent for political aims at any cost.(The second and fifth paragraphs were updated to reflect the news that Mustier will leave Unicredit. )This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Analyst Price Targets (1)
Low 27.08
High 27.08
Upgrades & Downgrades
| Downgrade | Credit Suisse: Neutral to Underperform | 7/23/2020 | |
| Upgrade | Citigroup: Sell to Neutral | 3/16/2020 | |
| Upgrade | CFRA: Hold to Buy | 2/20/2020 | |
| Upgrade | Keefe, Bruyette & Woods: Market Perform to Outperform | 2/7/2020 | |
| Upgrade | Jefferies: Hold to Buy | 11/18/2019 | |
| Upgrade | Goldman Sachs: Neutral to Buy | 5/23/2019 |
Company Profile
8 Canada Square
London E14 5HQ
United Kingdom
44 20 7991 8888
http://www.hsbc.com
Sector(s): Financial Services
Industry: Banks—Diversified
Full Time Employees: 230,317
HSBC Holdings plc provides banking and financial products and services worldwide. The company operates through Retail Banking and Wealth Management, Commercial Banking, Global Banking and Markets, and Global Private Banking segments. The Retail Banking and Wealth Management segment offers personal banking products and services, such as current and savings accounts, mortgages and personal loans, credit and debit cards, and local and international payment services; and wealth management services, including insurance and investment products, global asset management services, and financial planning services. The Commercial Banking segment provides credit and lending, treasury management, payment, cash management, commercial insurance, and investment services, as well as commercial cards, and international trade and receivables finance services; and foreign exchange products, and capital raising and advisory services to small and medium sized enterprises, mid-market enterprises, and corporates. The Global Banking and Markets segment is involved in the provision of financing, advisory, and transaction services, including credit, rates, foreign exchange, equities, money markets, and securities services, as well as principal investment activities to government, corporate and institutional clients, and private investors. The Global Private Banking segment provides a range of services to high net worth individuals and families with complex and international needs. HSBC Holdings plc was founded in 1865 and is headquartered in London, the United Kingdom.
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