UBS: HSBC HOLDINGS (00005) Q3 pre-provision profit misses expectations; maintain "Neutral" rating.

UBS released a research report stating that HSBC HOLDINGS (00005) Q3 pre-provision profit missed expectations, and the bank maintains its "Neutral" rating. HSBC HOLDINGS' Q3 pre-provision profit was 3% below market expectations, mainly dragged by lower revenue, of which banking net interest income was 2% below expectations, fees and other income were also 1% lower, while operating expenses were in line with expectations. Impairment provisions during the period were 21% below market expectations. Profit before tax was in line with expectations. UBS noted that the group's Q3 common equity tier 1 capital ratio was 13.9%, 20 basis points below expectations, mainly affected by a 0.4% decline in the common equity tier 1 capital ratio and a 1% increase in risk-weighted assets. The group announced a third interim dividend of US$0.1 per share, in line with expectations, and launched a share buyback of up to US$1 billion, in line with the bank's expectations. HSBC's 2026 guidance remains unchanged, including banking net interest income of at least US$46 billion, operating expenses growing about 1% to US$33.9 billion on a target basis, expected credit loss provisions of about 45 basis points, and the common equity tier 1 capital ratio maintained in the 14% to 14.5% range.