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I am a small investor and mainly invest for Dividends, only buy FTSE shares and don't play on the AIM market.
On the Record date I owned 12500 HSBC shares and now because of the BOE £2020 has been stolen off of me.
Now the UK HMRC are paying the out of work UK workers 80% of their income if their job was affected by coronavirus. I wonder if the HMRC would like to pay me 80% of my Dividend from HSBC, I think not.
The BOE should of kept their nose out with HSBC.
Someone should give a little lecture to BoE as to what HSBC is and where it is. For those who regularly pass through HKG and London, the matter is clear. If Barc, Lloy, etc need to cancel their dividend, the same is not true for a distinctly Asian bank like HSBC. What the board should do is to honor this payment to those investors who held on record date. More so if as they said. 75% of PI are in HKG itself. Very simple issue to solve. A lot by now, including me, have come out of this, which fared better up to recently, to go into other stocks/sectors. It's not good to those that the dividend will be initiated anew, they will get nothing if they don't buy back in...
That is the main bit. It is obvious now that HSBC didn't not want to cut the dividend. They will be paying again as soon as possible. I am happy to keep buying them.
The move is particularly damaging for HSBC, which generates more than four-fifths of its profits from Asia, despite being headquartered in London. A third of its shares are owned by retail investors in Hong Kong, who count on the dividend as part of their income.
“For the regulators at the Bank of England to put a gun to the head of the board of directors is terrible,” said one director. “This should be a decision for the board to take. We should not be in the UK. The calls for redomiciling will increase.”
Hong Kong investors have reacted with anger to HSBC’s decision to withhold the dividend for the first time since records began back in 1946. Shares in the lender fell 9.5 per cent in London and Hong Kong trading, wiping £8bn from its valuation.
If they do re domicile then thats a lot of lost tax revenue and employee taxes lost to the government. Hardly what is needed with brexit looming.
The Bank of England’s pressure on HSBC to cancel its dividend for the first time in 74 years has reignited a debate at the top of the bank over whether it should redomicile to Hong Kong.
Several people familiar with the matter said the BoE’s intervention had prompted anger among some board members and executives, with calls to reopen the question of whether the group’s legal base should move from London.
HSBC was one of five UK-based lenders that agreed on Tuesday night to withhold 2019 dividends, bowing to pressure from the BoE’s Prudential Regulation Authority, the UK’s top financial supervisor.
The move is particularly damaging for HSBC, which generates more than four-fifths of its profits from Asia, despite being headquartered in London. A third of its shares are owned by retail investors in Hong Kong, who count on the dividend as part of their income.
“For the regulators at the Bank of England to put a gun to the head of the board of directors is terrible,” said one director. “This should be a decision for the board to take. We should not be in the UK. The calls for redomiciling will increase.”
Hong Kong investors have reacted with anger to HSBC’s decision to withhold the dividend for the first time since records began back in 1946. Shares in the lender fell 9.5 per cent in London and Hong Kong trading, wiping £8bn from its valuation.
One executive, who said they were now leaning in favour of the bank moving back to Hong Kong, said the BoE’s demand that HSBC withhold its dividend had sent “out a message that we are weak when in fact we are in a good position”. Another executive described the BoE’s pressure as “very questionable”.
Those opinions are not representative of the group’s position, according to one person briefed on its stance, who added that the bank understood the reasons behind the BoE’s push on dividends. The central bank said the dividend cancellations would conserve capital buffers and give lenders “extra headroom [to] help the?.?.?.?economy” during coronavirus.
Tom
https://www.ft.com/content/f2e746e0-d399-421e-b565-d3c9ebead3c5
Agreed. To cancel a dividend after ex dividend is little more than theft in my book. My only saving grace is I unloaded quite a few before it went ex div, but for people relying on this money its a real kick in the nuts.
I am 100% okay with HSBC not paying any more dividends this year, BUT to not pay one after the Record date has passed is a bit much.
I wouldn't of expected a company like HSBC to welsh on an I.O.U which what it was. A promise to pay the owner of the shares on the record date 21 cents.
Whilst I can understand the reasons for non payment of dividends it is a bit much not to pay the one which is just a few weeks away from actual payment and well past the record date. There are many who rely on the dividends to pay their own bills etc. Perhaps a little more thought Should have been given with a reduction, not just total non payment over a longer period.
I don't like the dividend cut but thousands of shareholders take additional shares instead of cash. This will prevent millions of shares being issued at a cut price which would impact on the bank's ability to pay a reasonable level of dividend in the future.
The problem with these dividend cancellations is it introduces even more uncertainty and instability into the market.
What level will the dividend return at in all these companies, buying a risky share with a 10% divi is fine but if that is suspended and returns at 2% that is a different prospect. Also how will people in the future be persuaded to invest pension and ISA into shares going forward or is this an attempt to kill off this asset class after killing of buy to let.
Sadly Johnson there are a lot doing it and more will follow.....Crest Nicholson the firstvI picked up on....Hopefully all their Bug Bananas Bonus's will be secure
Message is
DONT BUY AN SP FOR THE DIVIS THIS YEAR
Apologies for caps it defaulted to that
GLA
How can they cancel a dividend after we past the record date ? That is the same as bouncing a cheque. I fully understand the need to cancel future dividends this year but not the one due on the 14th after already passing Record date.
Has the Dividend to be paid on the 14th April been cancelled ?
this has already gone past the ex-dividend date on the 27th Feb