HSBC HSBA.L shareholders face a future of paltry payouts when regulators restore its powers to pay dividends as the bank’s bosses press on with a costly revamp against a backdrop of a global recession and the threat of negative interest rates.

One of the banking sector’s most reliable dividends could be slashed by as much as 50%, analysts and investors say, with HSBC’s management expected to use the economic uncertainty to downgrade shareholder expectations.

Chief Executive Noel Quinn also faces pressure to keep lending to struggling households and businesses while keeping capital in reserve to pay for the bank’s overhaul and cover any bad debts if non-performing loans spike.

In August, Europe’s biggest bank by assets, warned that its bad debt charges for the year could hit $13 billion as the coronavirus pandemic hammered both its retail and corporate customers worldwide.

“Certainly in this climate it gives them a chance to reset,” said Hugh Young, managing director, Asia Pacific, Aberdeen Standard Investments, one of HSBC’s 10 largest shareholders. “They can blame, with a degree of reason, both COVID and government.”

HSBC declined to comment.

The bank, which derives the majority of its profits from Asia, has not paid an annual dividend below 35 cents since 2009.

Between 2008 and 2018, it paid an average 47.2 cents but analyst forecasts supplied by Refinitiv suggest its annual dividend will plunge to 15 cents in 2020, before recovering to 29 cents in 2021 and 37 cents in 2022.

Will Howlett, equity research analyst at HSBC shareholder Quilter Cheviot, said earnings and cash flow for banks would remain under pressure until at least 2023, when the U.S. Federal Reserve signalled it might be ready to raise rates.

“We see this as a longer lasting headwind than elevated loan losses as a result of the recession caused by lockdowns to control the spread of the virus,” he said.

“In this context, we would expect a significant rebasing of (HSBC’s) dividend … based on consensus, we see risks to the downside particularly if HSBC wants to retain a larger budget for a more radical restructuring at full-year results.”