HSBC (0005) is expected to post a 2.4 percent fall in its first-quarter pre-tax profit to US$12.57 billion (HK$98 billion) due to increasing credit losses, when the British lender releases its results today.
Analysts also estimate a total interim dividend of US$0.31 per share, including a special distribution of US$0.21 after the completed disposal of its business in Canada.
JP Morgan said the sluggish mainland property market would keep biting into HSBC's profits, forecasting the bank's credit impairment loss would jump 115 percent to US$928 million year-on-year.
But Goldman Sachs expects HSBC to set aside about US$640 million, saying the worst is over for the bank's exposure to the mainland real estate market.
JPM said HSBC may face inflationary pressures, seeing operating expenses rising over 5 percent to US$8 billion in the first quarter.
But with US Federal Reserve likely to keep interest rates at a high level for longer than anticipated, this will benefit the bank's net interest margins, it said.
The full-year net interest income is anticipated to reach US$42.2 billion, higher than US$41 billion in HSBC's guidance.
JPM expects HSBC to buy back US$10.5 billion worth of shares this year, but Goldman Sachs sees repurchases of US$8 billion only, with US$2 billion for the first quarter. Morgan Stanley also bets on a US$2 billion buyback program, but estimates HSBC's pre-tax profit will drop by 6.8 percent to US$12 billion for the first quarter, from a year ago.
