Hsbc, Stephen Engle, Hong Kong discussed on BTV Simulcast
Lines hitting the Bloomberg the red headline, then a beat on the pre adjusted tax six point one nine billion dollars, the company compiled estimate was for five point seven three billion dollars important to point out here. Adjusted jaws for nine months eighteen was negative one point six percent. Remember that analysts had always set at a third consecutive disappointment on operating jaws would be received very negatively, the, of course, is their way of measuring income growth versus cost growth. Also, some other important numbers there, Tracy from the Bank. Yeah. Lots of numbers to dig through. We're still getting some of those headlines coming through on the Bloomberg. But let's go over to our north Asia. Correspondent Stephen Engle. He's going to digest those for us. Justed pretense prophet is better than expected from the company compiled estimate of five point seven three billion coming in at six point one nine billion. But as use of just said that negative jaws for third consecutive quarter is something the market has been looking for in fact, HSBC the Bank itself has been kind of guiding the jaws of in positive territory for the second half, but they have fallen into negative territory for three consecutive quarter. Of course, Jon is the ratio of income growth versus cost growth. So they have not necessarily. I would assume from this giving their cost structure in line or they have not boosted their income growth necessarily enough. Goldman Sachs ahead of these numbers were saying the all the eyes will be on third quarter revenue momentum. And I'm just looking to see if we can get some third quarter revenue numbers. Yes. Third quarter adjusted revenue thirteen point eight billion dollars. The estimate was thirteen point six eight. So it's a slight beat on the revenue front. But again they've continued in negative jaws for third consecutive quarter. And as you rightfully said Yousef, a third consecutive negative jobs would be received a very negatively we're in the lunch break at Hongkong. The HSBC shares had been up slightly ahead of the results. Yeah. It's interesting. Stephen I'm looking here at some of the commentary. Goldman Sachs saying that the key focus is going to be on revenue. It's going to be on cost progression. You've got Morgan Stanley. They're looking again. I mean, there are overweight, and this particular company, and they're agreeing that good operating leverage will be key to HSBC's positive jaws guidance. Some other lines coming through here just to keep everybody in the loop. You've got the adjusted expected credit losses for the third quarter at five hundred seven million dollars. We know have commentary as well. From Mr. Flint from HSBC says it's encouraging the numbers are encouraging and they demonstrate revenue potential. It also comes down Stephen to the live or spread. That's been absolutely key. Especially in domestic markets in the UK and Hong Kong. Yeah. That's right. I mean, you would think given the rising rate environment. Here is they follow the fed that there would be a boost to the net interest margins here, don't go. We did talk to Fitch Ratings senior analysts though earlier this morning saying. Oh, the competitive environment here in Hong Kong will not necessarily translate higher to higher net interest margins because of the higher high board that we've seen, but that could be if we were in the long tightening cycle that could be a long term growth for the bag right now still not according to Fitch Ratings a going to be a big boost. I'm just looking at more of these numbers. We can kind of give it in a percentage rise that third quarter just a pretext prophet as I said beating the estimates by sixteen percents. So it's a fairly healthy arise over the estimates. The adjusted revenue increase to they mentioned just a few minutes ago, a thirteen point eight four billion that is a nine percent rise as well. So a fairly good numbers. But again, John Flint, the CEO who took over earlier this year his emphasis really is going to be on Asia. They get about seventy seven percent in the first half of justed pretax profit from Asia. He wants to continue that trend. He wants to go into. China. He said he wants to raise his hand. It'd be one of the first banks to be a London based banks to list in the new Shanghai London. Stop connect that could happen as early up and running as early as December. We'll we'll have to wait and see until this afternoon. Three thirty time that we're going to get the conference call from these executives at HSBC, Stephen. I was just about to ask John Flint, of course, about eight months into the job. So not that new. But then again, he's had time now to really push forward on some of his strategy. What are you going to be looking out for on the conference call, and what do you think investors are going to be watching for they're going to want an explanation on the negative jaws? Definitely and win that will likely turn around because they have been kind of telegraphing that they're going to get this turned around. So what knocked it back down. But also again, the Asian expansion. There is such a high reliance on Hong Kong. I mean, forty nine percent of their pre-tax profits comes from this market alone. And this is a market where the stock market is down seventeen percent. They are feeling the effects of the trade war between China and the United States where else can you find growth and keep in mind eighteen percent of their pretext profit comes from the UK market. You have that thing called Brexit as well. I think I've heard of that. Yes. Stephen thinking over here, of course, HSBC announcing an interim dividend per share of zero point one dollars. And in the past nine earnings. You've got five of them would stock reacted negatively to the earnings announcement people call sign that for you. But let's get you a bit of a preview of what's coming up. We'll talk about.