Investors anticipate hike in HBSC’s dividend after bank guides brokers
HSBC has been informally guiding brokers to expect a significant increase in its dividend next year.
The bank has said it will pay out up to 50 per cent of post-tax profits in dividends, City PM has learnt. Based on the higher end of consensus earnings figures that would result in a payout to shareholders of 45p per share – a dramatic increase on the 20p due to be paid out this year.
The news comes as the group’s shares rose strongly on news of third quarter profits that are expected to be “significantly ahead” of the same period in 2008.
Group chief executive Michael Geoghegan said HSBC’s investment banking arm was on track for a “record” year thanks to its exposure to Asian markets, which have recovered more quickly than western economies.
One fund manager described HSBC as “the best capitalised, best liquidity-profile bank” on the market.
HSBC’s shares closed 0.9 per cent up yesterday at 726.1p.
HSBC declined to comment.