HSBC shares rise as banking giant launches buy-back

HSBC has announced a $2.5bn (€2.23bn) share buy-back and pared ambitions to grow dividend payouts and returns. The pragmatic steps are to soothe investors, amid slowing growth in its home markets of Britain and Hong Kong.

The lender’s London-listed shares were trading 4.5% higher at one stage after the buy-back took the sting out of a 29% in January-June pretax profits, which matched analysts’ expectations.

The shares have dropped 19% this year. As Britain’s vote to leave the EU clouds economic prospects and Hong Kong absorbs slower growth in China, HSBC, Europe’s biggest bank, has opted to “remove a timetable” for reaching its targeted return on equity (RoE) in excess of 10% by the end of next year.