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HSBC's 4Q 2017 represents lost quarter - MacQ

  Macquarie Research lowered its target price for HSBC
Holdings (00005) to GBP8.02 from GBP8.46, but in HK$ terms it is broadly unchanged at
HK$87.23, and reiterated its "outperform" rating.
  The research house said HSBC FY2017 results fell short of consensus expectations at the
adjusted PBT level by 1.5%. This, together with the failure to announce a share buy back,
has caused the shares to retreat based on concerns of lower future earnings and capital
distributions.
   Macquarie believes these fears are largely ungrounded and that 4Q 2017 represents a 
lost quarter, not a deviation from the investment case.
  It predicted that the HSBC group NIM will rise from 163 bps in 2017 to 174 bps in 2018 
and then further to 184 bps in 2020. Given the strong position of the group balance sheet,
Macquarie made no changes to DPS (will be maintained at 51c) and share buy back (US$3bn pa
into the medium term) assumptions.

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