HSBC restarts buybacks as profits mushroom on Hong Kong growth Proactive uses images sourced from Shutterstock
HSBC Holdings PLC (LSE:HSBA) has unveiled a $1 billion share buyback, its first since pressing pause in October, after second-quarter profit earnings beat forecasts, supported by higher net interest income and growth in wealth.
The FTSE 100’s largest company reported pre-tax profit of $19.5 billion for the first six months of 2026, up 23% from a year earlier.
Second-quarter pre-tax profit jumped 60% to $10.1 billion, beating the consensus estimate of $9.51 billion. The comparison was flattered by a $2.1 billion charge relating to HSBC’s stake in China’s Bank of Communications a year earlier.
Overall, first-half profit benefited from a favourable $2.2 billion year-on-year swing in notable items. Excluding notable items and currency movements, pre-tax profit increased by $1.1 billion to $20.4 billion.
First-half revenue rose 11% to $37.7 billion, while banking net interest income increased 8% to $22.9 billion, helped by deposit growth and the reinvestment of HSBC’s structural hedge at higher yields. The Asia-focused bank also nudged guidance higher, saying banking NII would be “at least” $46 billion rather than “around” $46 billion previously.
Wealth and wholesale transaction banking fees also benefited from stronger customer activity, particularly in Hong Kong.
Expected credit losses increased 20% to $2.4 billion, including charges relating to UK fraud exposure, Hong Kong commercial property and uncertainty caused by the Middle East conflict.
Alongside the resumption of buybacks, which were halted after HSBC proposed buying the remaining shares in Hang Seng Bank for about $13.6 billion last October, a second interim dividend of 10 cents per share was also approved.
The key target for a return on average tangible equity of at least 17% through 2028 was maintained.
Chief executive Georges Elhedery said: “HSBC is becoming the stronger bank we set out to build. We are executing our strategic priorities with pace, precision and discipline.”