What to expect from HSBC and Standard Chartered results

HSBC and Standard Chartered are scheduled to report their full year earnings on Monday and Tuesday next week and investors will be keen to see how badly their businesses have been hit by the deteriorating conditions in Asia.

HSBC is already reportedly sounding out investors to find out whether there is any chance it could make any form of cash call and may announce news on this or possibly even a dividend cut alongside its numbers.

Asia-focused peer Standard Chartered so far has proved relatively immune to the global downturn - although it has already made a rights issue in November last year - but will have to convince shareholders that this will continue going forward.

So far, both shares have performed much better than their peers.

HSBC shares are down only 29% compared to a year ago, while Standard Chartered shares are down 60%.

Shares in Barclays, meanwhile, are sown 79% and shares in RBS have dropped 93% in the same time frame. 

Morgan Stanley analyst Michael Helsby has just returned from a trip in Asia where he says investors there are much more cautious about the outlook for the Asian economy – chiefly Hong Kong, Korea, Singapore, Taiwan and India – than many people in Europe.

'Concerns surrounding bank profits are very high, with credit costs, net interest margins, fee generation and, interestingly, capital top of the worry list,' he said.

HSBC

In particular he said that Asian investors are now convinced HSBC will have to raise more funds and their main concern was whether they should buy on any confirmation.