HSBC HOLDINGS (00005) reported robust third-quarter results, with adjusted pre-tax profit reaching $9.1 billion on a constant currency basis, exceeding Goldman Sachs' estimates and market consensus by 7% and 9%, respectively. The outperformance was primarily driven by stronger-than-expected revenue growth, supported by higher net interest income from both banking and non-banking operations. Costs and credit provisions were largely in line with expectations.

The bank's Common Equity Tier 1 (CET1) ratio stood at 14.5%, meeting market expectations. HSBC raised its 2025 return on tangible equity (ROTE) guidance to "mid-teens" (14%-16%) or higher, compared to a market consensus of 16%, while maintaining its mid-teens ROTE outlook for 2025–2027.

Additionally, HSBC increased its 2025 net interest income guidance for banking operations to $43 billion or above, up from approximately $42 billion (market consensus: $42.5 billion). The bank retained its 2025 cost growth target of around 3%, translating to total operating expenses of $33.5 billion (market consensus: $33.3 billion). HSBC also plans to achieve $1.5 billion in cost savings by the end of 2026.

For 2025, HSBC expects credit costs of about 40 basis points (slightly above market consensus) and maintains its medium-term credit cost guidance at 30–40 basis points. Goldman Sachs has not assigned an investment rating to HSBC.

Earlier this month, HSBC announced plans to privatize HANG SENG BANK (00011), with Goldman Sachs serving as a joint financial advisor for the transaction.