Key Insights

• The considerable ownership by public companies in Hang Seng Bank indicates that they collectively have a greater say in management and business strategy
• The largest shareholder of the company is HSBC Holdings plc with a 63% stake
• Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

If you want to know who really controls Hang Seng Bank Limited (HKG:11), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 63% to be precise, is public companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And individual investors on the other hand have a 30% ownership in the company.

In the chart below, we zoom in on the different ownership groups of Hang Seng Bank.

What Does The Institutional Ownership Tell Us About Hang Seng Bank?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

Hang Seng Bank already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Hang Seng Bank's historic earnings and revenue below, but keep in mind there's always more to the story.

Hang Seng Bank is not owned by hedge funds. The company's largest shareholder is HSBC Holdings plc, with ownership of 63%. This implies that they have majority interest control of the future of the company. With 1.6% and 1.5% of the shares outstanding respectively, BlackRock, Inc. and The Vanguard Group, Inc. are the second and third largest shareholders.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Hang Seng Bank

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own less than 1% of Hang Seng Bank Limited. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own HK$28k of stock. Arguably recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 30% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Public Company Ownership

Public companies currently own 63% of Hang Seng Bank stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Hang Seng Bank better, we need to consider many other factors. For example, we've discovered 1 warning sign for Hang Seng Bank that you should be aware of before investing here.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.