BBC NEWS | Business | Flush HSBC rewards investors first
BBC NEWS | Business | Flush HSBC rewards investors first: "Flush HSBC rewards investors first
by Gavin Stamp
BBC News business reporter
Spending money can cause headaches whether you are a window shopper on a shoe-string budget or the country's wealthiest bank.
In the case of HSBC, which has reported record profits for a UK High Street bank of £11.5bn, finding an appropriate home for such a pile of cash is necessarily complicated.
After such a lucrative year, should the bank increase rewards for its shareholders or share more of the proceeds with its 250,000 staff?
On the other hand, should it use the money to fund further global expansion, boost its offering in specific areas or, even, put something under the bed for the proverbial rainy day?
The answer, generally speaking, would seem to be a little of everything.
In line with our strategy, we concentrated on organic growth
HSBC
But it is the bank's shareholders - which range from multinational financial institutions to small investors in the UK and further afield - who will be the main winners.
HSBC is planning to return about £4.2bn to investors this year through dividends, approximately half of the £8.2bn available to the firm after tax and other deductions.
Dividend clamour
Banks such as HSBC have come under growing pressure in recent times to give more of their substantial profits back to shareholders.
Investors argue that large amounts of 'excess capital' - money left over beyond a bank's operating needs and funds required by regulators to safeguard against sudden financial difficulties - are inefficient.
They should either be spent - which banks have historically done on acquisitions, most recently overseas deals - or paid back, investors say.
Banks have heard this growing clamour and reacted.
While HSBC is increasing its dividend by 11%, Royal Bank of Scotland - which owns National Westminster Bank - recently said it would r"
by Gavin Stamp
BBC News business reporter
Spending money can cause headaches whether you are a window shopper on a shoe-string budget or the country's wealthiest bank.
In the case of HSBC, which has reported record profits for a UK High Street bank of £11.5bn, finding an appropriate home for such a pile of cash is necessarily complicated.
After such a lucrative year, should the bank increase rewards for its shareholders or share more of the proceeds with its 250,000 staff?
On the other hand, should it use the money to fund further global expansion, boost its offering in specific areas or, even, put something under the bed for the proverbial rainy day?
The answer, generally speaking, would seem to be a little of everything.
In line with our strategy, we concentrated on organic growth
HSBC
But it is the bank's shareholders - which range from multinational financial institutions to small investors in the UK and further afield - who will be the main winners.
HSBC is planning to return about £4.2bn to investors this year through dividends, approximately half of the £8.2bn available to the firm after tax and other deductions.
Dividend clamour
Banks such as HSBC have come under growing pressure in recent times to give more of their substantial profits back to shareholders.
Investors argue that large amounts of 'excess capital' - money left over beyond a bank's operating needs and funds required by regulators to safeguard against sudden financial difficulties - are inefficient.
They should either be spent - which banks have historically done on acquisitions, most recently overseas deals - or paid back, investors say.
Banks have heard this growing clamour and reacted.
While HSBC is increasing its dividend by 11%, Royal Bank of Scotland - which owns National Westminster Bank - recently said it would r"
posted by eecalvin @ 10:07 PM
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