Bank of America Expresses Optimism Ahead of HSBC’s Third-Quarter Results

Bank of America has reaffirmed its bullish outlook on HSBC, designating it as its top pick in the banking sector for the year, while anticipating varied performance among British banks for the third quarter.

The bank suggests that higher interest rates, alongside growth in loans and deposits, will bolster net interest income, whereas fee-based revenue may see mixed results. It maintains "buy" ratings for HSBC, NatWest, and Lloyds, while issuing a "neutral" rating for Barclays.

Despite robust growth in deposits and loans in Hong Kong, the bank expects capital pressures to constrain HSBC’s share buybacks. It projects buybacks to reach $1 billion—a figure lower than the market’s expectation of $1.6 billion.