Statement on 2019 fourth interim dividend and 2020 ordinary share dividends
The Board of HSBC Holdings plc (‘HSBC’) has today received from the Bank of England through the Prudential Regulation Authority (‘PRA’) a written request not to pay, in HSBC's case, the fourth interim dividend in respect of 2019. Similar requests have been made to other UK incorporated banking groups.
The Board recognises the current and potential material impact on the global economy as a result of the coronavirus pandemic and the important role that HSBC has in helping its customers to manage through the crisis and to have resources to invest when recovery occurs. HSBC has a strong capital, funding and liquidity position; however, there are significant uncertainties in assessing the time period of the pandemic and its impact.
The Board has therefore met to discuss the written request from the PRA and, in response to the request, has cancelled the fourth interim dividend of US$0.21 per ordinary share, which was scheduled to be paid on Tuesday, 14 April 2020. The Board regrets the impact this cancellation will have on our shareholders, including our retail shareholders in Hong Kong, the UK and elsewhere.
The Board has also decided that until the end of 2020 we will make no quarterly or interim dividend payments or accruals in respect of ordinary shares, or undertake any share buy-backs in respect of ordinary shares.
The Board will review the ordinary share dividend policy and payments in respect of 2020 once the full impact of the pandemic is better understood, and economic forecasts for global growth in future years are clearer. These factors will be considered, alongside analysis of our own internal financial projections and modelling.
HSBC is committed to supporting customers in the economies in which we serve, in particular in our two home markets of Hong Kong and the UK. In strengthening its ability to support its customers, the Board believes that HSBC will be better placed to grow its business for the long term.
HSBC will announce its first quarter 2020 results on Tuesday, 28 April 2020. Group performance has been resilient in the first quarter in difficult economic conditions and, so far, credit performance has held up well. However, as a result of the global impacts of COVID-19, and its impact on interest rates, market levels and the forward economic outlook, we expect reported revenues to be impacted in insurance manufacturing, and credit and funding valuation adjustments in Global Banking & Markets, alongside higher Expected Credit Losses (‘ECL’).
For and on behalf of
HSBC Holdings plc
Group Company Secretary and Chief Governance Officer
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