Trusted by over 15 Million Traders
The Most Awarded Broker
for a Reason
CATEGORIES
News
- 【XM Group】--EUR/USD Forecast: Overhead Resistance
- 【XM Group】--USD/TRY Forecast: Turkish Lira Holds Steady Near 36
- 【XM Forex】--GBP/USD Forex Signal: Bears Prevail Ahead of US Nonfarm Payrolls Dat
- 【XM Market Review】--USD/CAD Forecast: Eyes Breakout Above 1.45
- 【XM Forex】--BTC/USD Forex Signal: Bounce Following Drop to 3-Month Low
market analysis
Why did HSBC suddenly take action to privatize Hang Seng Bank?
Wonderful introduction:
Only by setting off, can you reach your ideals and destinations, only by hard work can you achieve brilliant success, and only by sowing can you reap the rewards. Only by pursuing can you taste upright people.
Hello everyone, today XM Forex will bring you "[XM Forex Official Website]: It is planned to privatize Hang Seng Bank, why did HSBC suddenly take action?". Hope this helps you! The original content is as follows:
XM Hong Kong Stocks: It is planned to privatize Hang Seng Bank. Why did HSBC suddenly take action?
XM Hong Kong stocks: On Thursday, HSBC (00005) planned to privatize Hang Seng Bank (00011) at 155 yuan per share and proposed to revoke Hang Seng’s listing status. After Hang Seng Bank opened 15% higher yesterday, it rose by more than 40% at most; HSBC once fell 6.7%, the biggest drop in six months. Today, HSBC Holdings stock price continued to fall to a one-month low.
▲XM chart
HSBC stated in an announcement that the consideration for the privatization plan is a cash payment of HK$155 per plan share. If the proposals are implemented, all Hang Seng Bank's scheme shares will be cancelled. The deal www.xmltrust.comes as HSBC Chief Executive Al Qiao Zhi carries out the biggest restructuring of HSBC in at least a decade. In the past few years, the bank has also shifted its focus to Asia, closing and selling some businesses in Europe and North America.
HSBC announced that Hang Seng Bank will retain its independent banking accreditation under the Hong Kong Banking Ordinance and maintain independent corporate governance, brand image, unique market positioning, and branch network. The privatization will not change Hang Seng Bank's day-to-day interactions with its customers. On top of this, Hang Seng Bank customers can enjoy HSBC’s broader global network and financial product packages.
The announcement stated that after privatization, HSBC will continue to strategically invest in the human capital of Hang Seng Bank, and provide more diversified training and job opportunities for Hang Seng Bank employees to enhance talent and career development. In addition, Hang Seng Bank will benefit from HSBC’s global financial resources, capital management andThe market has entered.
HSBC currently holds approximately 63% of Hang Seng Bank’s shares and will spend approximately US$14 billion to acquire the shares it does not already hold. The bank plans not to initiate any further share buybacks over the next three quarters as it seeks to restore capital ratios to its target operating range. Ai Qiao Zhi has reorganized HSBC into four new divisions and exited some businesses that his predecessor regarded as key to future growth, while increasing investment in markets such as Greater China and the Middle East.
Why privatize Hang Seng Bank?
In the current www.xmltrust.complex geopolitical and macroeconomic context, HSBC is continuing to optimize its global business layout (such as withdrawing from some Western markets and focusing on Asia). Fully bringing the core assets of the core market (Hong Kong) under its control is in line with its strategic focus of "returning to Asia" and can strengthen its absolute control over Hong Kong and the Greater Bay Area business.
HSBC has been well capitalized in recent years, but faces the challenge of a scarcity of high-return investment opportunities globally. Rather than leaving a large amount of cash sitting around or investing it at a low rate of return, it could be better spent acquiring a familiar and high-quality asset. The cash acquisition of Hang Seng can be regarded as a large-scale capital return operation for assets within its own "ecosystem", and the expected rate of return (i.e., Hang Seng's ROE) may be higher than HSBC's own average cost of capital.
HSBC has been pushing Hang Seng Bank to clean up its www.xmltrust.commercial real estate bad debts. As of June 2025, Hang Seng Bank's Hong Kong www.xmltrust.commercial real estate loans that have been credit-impaired have increased to HK$25 billion, a year-on-year increase of 85%. The transaction will enable Hang Seng Bank to offer customers a wider range of products and better access to HSBC's international network. After privatization, HSBC can more thoroughly integrate the businesses of the two banks, eliminate duplicate functional departments, achieve closer collaboration in areas such as retail banking and wealth management, reduce costs, and improve overall operational efficiency. In addition, banks need to transform quickly amid the wave of digitalization and www.xmltrust.competition from financial technology www.xmltrust.companies. A unified structure will help HSBC promote Hang Seng's digital transformation more decisively and avoid possible inconsistencies in strategic execution as two independent listed www.xmltrust.companies.
HSBC’s stock price fell sharply after the news, indicating that the market is worried that the acquisition will be costly and consume a large amount of HSBC’s cash reserves, which may affect its future dividend payment ability or other investment plans. In addition, the integration process may have unexpected difficulties and costs, and the market has doubts about this. But if HSBC can successfully realize the synergies and value release it claims, it will be positive in the long term. HSBC's price-to-book ratio is about 1.34 times, while Hang Seng Bank's is 1.78 times, according to data www.xmltrust.compiled by Bloomberg. If the transaction is ultimately proven to increase ROE and growth potential, HSBC's valuation (price-to-book ratio P/B) is expected to be repaired and improved.
The above content is all about "[XM Foreign Exchange Official Website]: Hang Seng Bank is planned to be privatized, why did HSBC suddenly take action?" It was carefully www.xmltrust.compiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your transactions! Thanks for the support!
Only the strong understandStruggle; the weak are not qualified even if they fail, but are born to be conquered. Hurry up and study the next content!
Disclaimers: XM Group only provides execution services and access permissions for online trading platforms, and allows individuals to view and/or use the website or the content provided on the website, but has no intention of making any changes or extensions, nor will it change or extend its services and access permissions. All access and usage permissions will be subject to the following terms and conditions: (i) Terms and conditions; (ii) Risk warning; And (iii) a complete disclaimer. Please note that all information provided on the website is for general informational purposes only. In addition, the content of all XM online trading platforms does not constitute, and cannot be used for any unauthorized financial market trading invitations and/or invitations. Financial market transactions pose significant risks to your investment capital.
All materials published on online trading platforms are only intended for educational/informational purposes and do not include or should be considered for financial, investment tax, or trading related consulting and advice, or transaction price records, or any financial product or non invitation related trading offers or invitations.
All content provided by XM and third-party suppliers on this website, including opinions, news, research, analysis, prices, other information, and third-party website links, remains unchanged and is provided as general market commentary rather than investment advice. All materials published on online trading platforms are only for educational/informational purposes and do not include or should be considered as applicable to financial, investment tax, or trading related advice and recommendations, or transaction price records, or any financial product or non invitation related financial offers or invitations. Please ensure that you have read and fully understood the information on XM's non independent investment research tips and risk warnings. For more details, please click here