HSBC shares flat, FTSE 100 lower
Calls for a break-up of HSBC failed to ignite its shares today as a sceptical City focused on the huge cost of separating the lender’s powerhouse Asia operations.
The heavyweight stock lagged the rest of the financial sector, despite its biggest shareholder lobbying for a split in order to boost returns and mitigate geopolitical risk.
Chinese insurance giant Ping An’s plan, which it reportedly wants to put to a shareholder vote, would see the Asia business listed and based in Hong Kong with the rest in London.
But analysts UBS cautioned that the impact from material restructuring costs significantly reduced the “upside of break-up maths“. They said these factors were particularly unwelcome at a time when higher interest rates are due to boost profits.
UBS today raised its price target on HSBC shares by 30p to 640p, although the stock remained closer to 500p after edging up 1.6p to 502.9p.
In contrast to HSBC’s lacklustre performance, NatWest and Lloyds Banking Group both rose 1% as investors look for another margin-enhancing rise in interest…
