22nd Apr 2016 11:00
LONDON (Alliance News) - HSBC Holdings PLC, the second largest dividend payer in the FTSE in 2015, is "ever more conscious" of the importance of the payment to shareholders, Chairman Douglas Flint said Friday, particularly in the wake of the drop in its share price over the course of the last year.
Speaking at HSBC's annual meeting of shareholders, Flint said the share price is a matter of "huge importance" to all at the gathering. Since the corresponding gathering a year earlier, the bank's share price has fallen by about 23%, or 17% taking into account dividends received by shareholders in that time, he said.
"Clearly we are not content with this. We are all acutely aware of the importance of the share price - it affects all of us, including the executive directors who are largely paid in shares," Flint told shareholders.
Chief Executive Stuart Gulliver struck a similar tone. "The share price isn't where we want it to be," he said, citing weak global growth and China's economic slowdown, zero or negative rates implemented in markets such as Europe, and an uncertain outlook for the global economy.
Having seen its pretax profit rise by 1.0% to USD18.87 billion in 2015, HSBC increased its total dividend for that year to USD0.51 per share from USD0.50 per share. Future increases in the dividend depend on profitability, Gulliver said.
"Our ability to pay an industry-leading dividend continues to set HSBC apart," Gulliver said. "We remain committed to a progressive dividend, subject to the overall long-term profitability of the group and the further release of less efficiently deployed capital."
Shares in HSBC were down 0.7% at 468.45p on Friday midday in London.
By Samuel Agini; [email protected]; @samuelagini
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