Ge Long Hui·2025-08-01 02:21Core Viewpoint - Citigroup has downgraded HSBC Holdings' 2025 basic earnings per share (EPS) forecast by 4%, primarily due to significant impairment charges in Hong Kong's commercial real estate sector [1] - The EPS estimate was also reduced by 9% due to substantial impairments related to Bank of Communications [1] - Slight downward adjustments of 1% were made to the EPS forecasts for 2026 and 2027 [1] Group 1 - Citigroup's updated pre-tax profit forecast for HSBC remains 5% to 7% higher than market expectations, benefiting from slightly higher net interest income [1] - The forecast for fiscal year 2025 is set at $42.5 billion, compared to market guidance and consensus of approximately $42 billion [1] - Non-interest income is expected to significantly increase due to ongoing growth in Asian wealth management business [1] Group 2 - Citigroup anticipates HSBC's tangible return on equity for 2025 to 2027 to be between 15.5% and 17%, exceeding HSBC's target of 14% to 16% and market expectations of 15% to 15.5% [1] - Following the adjustments to EPS estimates, the target price for HSBC has been slightly reduced from HKD 106.2 to HKD 105.6, while maintaining a "Buy" rating [1]