HSBC Backs Dividend, Returns Targets Despite Gloomy Economic Outlook

By Adam Clark

HSBC Holdings PLC (HSBA.LN) on Friday committed to maintaining its dividend payout at its current level and stuck to its returns targets, despite its bosses warning of a slowdown in global growth.

"Looking at the current environment, the global economy is much less predictable now than it was a year ago. Global growth is slowing, largely as a result of weakness in Europe although the economic outlook is also softer in the U.S. and in Asia," Chairman Mark Tucker said, speaking at HSBC's annual general meeting in Birmingham, England.

Chief Executive John Flint also said the global economic outlook had worsened since late 2018. He said HSBC is yet to take higher credit losses, but warned that could change in a downturn.

Despite the pessimistic tone, Mr. Flint said HSBC is still aiming for its previously announced targets of making a return on tangible equity higher than 11% by 2020, up from 8.6% in 2018. The Asia-focused lender also still expects "positive jaws"--where revenue grows faster than costs--in 2019, after falling short last year due to a weak fourth quarter.

Mr. Tucker said HSBC would keep its dividend at the 51 cents a share it paid out in 2018 for the foreseeable future.

Write to Adam Clark at [e-mail]; @AdamDowJones

(END) Dow Jones Newswires

April 12, 2019 06:51 ET (10:51 GMT)

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