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2021-07-13
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HSBC, Standard Chartered dividend limits removed by Bank of England
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The dividend suspension raised the ire of retail investors, many of whom are in Hong Kong and rely on the regular payouts.</p>\n<p>When banks were allowed to resume payouts, the regulator said that distributions to shareholders should not exceed 20 basis points of risk-weighted assets at the end of the year or 25 per cent of cumulative profits for all of 2019 and 2020 after deducting prior shareholder payouts.</p>\n<p>Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.</p>\n<p>The regulator also asked banks to exercise a \"high degree of caution and prudence\" in determining the size of any cash bonuses to senior staff at the time. Top executives at HSBC and Standard Chartered waived their bonuses in 2020 and said they would donate part of their salaries to help fight the pandemic.</p>\n<p>\"The PRA judges that banks remain well capitalised and resilient to outcomes for the economy that are much more severe than the [central bank's] Monetary Policy Committee's central forecast, and that they should therefore be able to support households and businesses through the economic recovery,\" the regulator said in a statement on Tuesday.</p>\n<p>\"In addition, although considerable uncertainty remains, the level of uncertainty has decreased significantly since December 2020, in particular due to the progress of vaccination programmes.\"</p>\n<p>The announcement will be welcome news for shareholders in Hong Kong as HSBC and Standard Chartered, two of the three currency issuing banks in the city, prepare to report their half-year results in August. The suspension spurred a rebellion among investors here.</p>\n<p>HSBC and Standard Chartered are both based in London, but generate the bulk of their profit in Asia, with Hong Kong as their largest market.</p>\n<p>After getting the greenlight from its regulator, HSBC said that it would pay a full-year dividend of 15 US cents a share for 2020 in April of this year and would target a payout ratio of 40 per cent and 55 per cent of reported earnings for 2022 onwards. Standard Chartered said at the time it would make a dividend payout of 9 US cents a share for full-year 2020.</p>\n<p>That compared with 30 US cents a share paid out by HSBC on an interim basis in 2019 and 7 US cents a share by Standard Chartered before they suspended their final dividends last year.</p>\n<p>Tuesday's announcement followed the Bank of England's latest report card on the UK's financial stability, which found that the country's economic outlook had improved, but risks remained to the recovery and banks would need to continue to support the economy.</p>\n<p>The vaccination levels in the UK have prompted the government to ease social distancing restrictions, with a complete lifting of those restrictions expected later this month. Nearly 70 per cent of the UK population has received at least the first dose of the vaccine, compared with 38.6 per cent of the population in Hong Kong.</p>\n<p><img src=\"https://static.tigerbbs.com/88ac17cb2071027fa613e24e8442ed25\" tg-width=\"972\" tg-height=\"648\" referrerpolicy=\"no-referrer\"></p>\n<p><i>Commuters outside HSBC's main building in Hong Kong. Photo: Bloomberg alt=Commuters outside HSBC's main building in Hong Kong. Photo: Bloomberg</i></p>\n<p>The announcement also came as several big American rivals are expected to report their first-half results this week, with JPMorgan Chase and Goldman Sachs expected to report their results later on Tuesday.</p>\n<p>Shares of HSBC rose 2.6 per cent to close at HK$45.05 in Hong Kong on Tuesday, while Standard Chartered's shares rose 2.5 per cent to close at HK$49.50.</p>\n<p>HSBC did not immediately have a comment when contacted on Tuesday, while a Standard Chartered spokeswoman declined to comment.</p>\n<p>In its announcement, the PRA said it remained essential for banks to continue to support households and businesses in the UK as its economy continues to recovery from a pandemic-induced slowdown and as the British government unwinds support measures.</p>\n<p>\"Bank boards should therefore continue to exercise an appropriate degree of caution around the level of any shareholder distributions,\" the regulator said.</p>","source":"yahoofinance","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; 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overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nHSBC, Standard Chartered dividend limits removed by Bank of England\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-07-13 19:30 GMT+8 <a href=https://finance.yahoo.com/news/hsbc-standard-chartered-dividend-limits-093000192.html><strong>South China Morning Post</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The Bank of England removed a series of \"temporary guardrails\" implemented in December that restricted the amount HSBC, Standard Chartered and other United Kingdom-based lenders could distribute to ...</p>\n\n<a href=\"https://finance.yahoo.com/news/hsbc-standard-chartered-dividend-limits-093000192.html\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"HSBC":"汇丰","SMP":"Standard Motor Products Inc"},"source_url":"https://finance.yahoo.com/news/hsbc-standard-chartered-dividend-limits-093000192.html","is_english":true,"share_image_url":"https://static.laohu8.com/5f26f4a48f9cb3e29be4d71d3ba8c038","article_id":"2151652275","content_text":"The Bank of England removed a series of \"temporary guardrails\" implemented in December that restricted the amount HSBC, Standard Chartered and other United Kingdom-based lenders could distribute to shareholders when they resumed paying dividends for the 2020 financial year.\nHSBC and Standard Chartered cancelled their final 2019 payments and suspended interim payouts last year at the request of the Prudential Regulation Authority (PRA), an arm of the Bank of England, to make sure banks had enough capital on hand to help fund the economy in light of the coronavirus pandemic. The dividend suspension raised the ire of retail investors, many of whom are in Hong Kong and rely on the regular payouts.\nWhen banks were allowed to resume payouts, the regulator said that distributions to shareholders should not exceed 20 basis points of risk-weighted assets at the end of the year or 25 per cent of cumulative profits for all of 2019 and 2020 after deducting prior shareholder payouts.\nDo you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.\nThe regulator also asked banks to exercise a \"high degree of caution and prudence\" in determining the size of any cash bonuses to senior staff at the time. Top executives at HSBC and Standard Chartered waived their bonuses in 2020 and said they would donate part of their salaries to help fight the pandemic.\n\"The PRA judges that banks remain well capitalised and resilient to outcomes for the economy that are much more severe than the [central bank's] Monetary Policy Committee's central forecast, and that they should therefore be able to support households and businesses through the economic recovery,\" the regulator said in a statement on Tuesday.\n\"In addition, although considerable uncertainty remains, the level of uncertainty has decreased significantly since December 2020, in particular due to the progress of vaccination programmes.\"\nThe announcement will be welcome news for shareholders in Hong Kong as HSBC and Standard Chartered, two of the three currency issuing banks in the city, prepare to report their half-year results in August. The suspension spurred a rebellion among investors here.\nHSBC and Standard Chartered are both based in London, but generate the bulk of their profit in Asia, with Hong Kong as their largest market.\nAfter getting the greenlight from its regulator, HSBC said that it would pay a full-year dividend of 15 US cents a share for 2020 in April of this year and would target a payout ratio of 40 per cent and 55 per cent of reported earnings for 2022 onwards. Standard Chartered said at the time it would make a dividend payout of 9 US cents a share for full-year 2020.\nThat compared with 30 US cents a share paid out by HSBC on an interim basis in 2019 and 7 US cents a share by Standard Chartered before they suspended their final dividends last year.\nTuesday's announcement followed the Bank of England's latest report card on the UK's financial stability, which found that the country's economic outlook had improved, but risks remained to the recovery and banks would need to continue to support the economy.\nThe vaccination levels in the UK have prompted the government to ease social distancing restrictions, with a complete lifting of those restrictions expected later this month. Nearly 70 per cent of the UK population has received at least the first dose of the vaccine, compared with 38.6 per cent of the population in Hong Kong.\n\nCommuters outside HSBC's main building in Hong Kong. Photo: Bloomberg alt=Commuters outside HSBC's main building in Hong Kong. Photo: Bloomberg\nThe announcement also came as several big American rivals are expected to report their first-half results this week, with JPMorgan Chase and Goldman Sachs expected to report their results later on Tuesday.\nShares of HSBC rose 2.6 per cent to close at HK$45.05 in Hong Kong on Tuesday, while Standard Chartered's shares rose 2.5 per cent to close at HK$49.50.\nHSBC did not immediately have a comment when contacted on Tuesday, while a Standard Chartered spokeswoman declined to comment.\nIn its announcement, the PRA said it remained essential for banks to continue to support households and businesses in the UK as its economy continues to recovery from a pandemic-induced slowdown and as the British government unwinds support measures.\n\"Bank boards should therefore continue to exercise an appropriate degree of caution around the level of any shareholder distributions,\" the regulator said.","news_type":1},"isVote":1,"tweetType":1,"viewCount":111,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"EN","currentLanguage":"EN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":13,"xxTargetLangEnum":"ORIG"},"commentList":[],"isCommentEnd":true,"isTiger":false,"isWeiXinMini":false,"url":"/m/post/142743853"}
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