HSBC (0005.HK/HSBA.L) 3Q26 Preview: A steady quarter expected focus will be on NII outlook and buybacks

HSBC will report 3Q26 results on 27 October. We expect underlying PBT of US$10.4bn, +14% yoy/+1% qoq, 2% ahead of Visible Alpha Consensus. Banking NII growth should remain supported by continued balance sheet expansion and a higher rate environment, while credit costs remain broadly stable; non-banking NII is expected to moderate after an exceptionally strong 2Q, especially in CIB. We model US$0.5bn of share buybacks this quarter, down from US$1.0bn announced in 2Q26, reflecting loan growth and negative OCI impact from steeper yield curves (~20bp CET1 hit), with 3Q26 CET1 forecast at 13.9%. We adjust underlying EPS estimates by -0.7% to 0.6% for FY26-29E, set our 12-month two-stage DDM TP for 0005.HK at HK$192 (from HK$193) and keep HSBA.L at 1,860p. We maintain Buy ratings on both.