The British credit institution HSBC Holdings Plc $HSBA (+3,61%) has reported a decline in profits and sales in the first quarter.
In addition, the Board of Directors has declared a first interim dividend for 2025 of $0.10 per share.
The company now intends to initiate a share buyback of up to $3 billion, to commence shortly after the annual general meeting on May 2 and to be completed by the time the 2025 interim results are announced.
Looking ahead, the company continues to expect the net asset value of its banking business to be around USD 42 billion in 2025.
The company continues to expect a mid-teens average return on equity in each of the three years from 2025 to 2027 with no significant items.
HSBC added: "Given the current uncertainty and market turmoil, we expect demand for credit to remain subdued in 2025. However, we continue to expect mid-single digit percentage growth in customer loans year-on-year in the medium to long term. In the medium term, we continue to expect average annual growth in the double-digit percentage range for fees and other income from Wealth.
In the first quarter, profit before tax fell from USD 12.65 billion in the previous year to USD 9.48 billion, which is primarily due to the absence of the net impact of USD 3.7 billion in the previous year in connection with the sale of the banking business in Canada and the business in Argentina.
Profit after tax amounted to USD 7.57 billion and was thus below the previous year's figure of USD 10.84 billion.
Sales fell by 15 percent to USD 17.65 billion (previous year: USD 20.75 billion), mainly due to the effects of business disposals, particularly in Canada and Argentina. At constant exchange rates, sales excluding significant items increased by 7 percent.
Net interest income of USD 8.3 billion fell by USD 0.4 billion in the quarter compared to the previous year. The net interest margin of 1.59 percent fell by 4 basis points.
"Our strong results this quarter demonstrate the momentum in our earnings, the discipline in executing our strategy and the confidence in our ability to achieve our goals. We continue to support our clients through this period of economic uncertainty and market unpredictability, which we are approaching from a position of financial strength," commented Georges Elhedery, CEO of HSBC Group.