Hsbc Holdings Plc · LSE:HSBA
Hsbc — FY2001 Earnings Presentation
26 slides from Hsbc's earnings presentation, 2002
Slide 1: HSBC Holdings plc 2001 Results
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Slide 2: Forward-looking statements
Forward-looking Forward-looking statements statements This This presentation presentation andand subsequent subsequent discussion discussion may may contain contain certain certain forward-looking forward-looking statements statements with with respect respect toto the the financial financial condit
Slide 3: 2001 results - overview
2001 results - overview Cash Cash basis basis Reported Reported US$m US$m Operating Operating profit profit before before provisions 11,283 é provisions 11,283 é 3% 3% 10,484 10,484 flat flat Pre-tax Pre-tax profit profit 8,807 ê 8,807 ê 14% 14% 8,000 ê 8,000 ê 18% 18% Attributable Attributable prof
Slide 4: 2001 results highlights
2001 results highlights ➣ On a cash basis: Revenues up US$1.3bn : Costs up US$1.0bn At constant currency, excluding CCF: Revenues up $1.1bn : Costs up $0.85bn ➣ Charges re Argentina: US$1,120m ➣ Provision re Princeton Notes matter: US$575m ➣ Disposal gains: US$754m (2000 US$302m) ➣ Tax rate 19.7% (2
Slide 5: Operating margin
Operating margin (Operating (Operating profit profit before before provisions, provisions, excluding excluding goodwill goodwill amortisation amortisation as as % % of of average average risk-weighted risk-weighted assets) assets) Bad debt charge (Bad (Bad debt debt charge charge as as % % of of 4.0
Slide 6: Line of business analysis - Pre-tax profit
Line of business analysis - Pre-tax profit * 2000 Other 2001 Other 4% Personal 2% Financial Personal Corporate, Financial Services Corporate, Investment Services 29% Investment Banking & 33% Banking & Markets Markets 38% 35% Private Commercial Private Banking Commercial Banking Banking Banking 5% 27
Slide 7: Net interest margins
Net interest margins 2001 2001 Change Change H2 H2 01 01 Change Change on on 2000 2000 on on H1 H1 01 01 HSBC HSBC Bank 2.80 13bp 13bp 2.88 2.88 16bp 16bp Hang Hang Seng Bank 2.56 (12)bp 2.55 (3)bp (3)bp The The Hongkong Hongkong andand Shanghai Shanghai Banking Banking Corporation Corporation -- Ho
Slide 8: Notes on margin trends
Notes on margin trends Increase Increase in in shorter shorter maturities maturities 1999 1999 2000 2000 2001 2001 Customer Customer accounts accounts (average (average balances) balances) Demand Demand 41.2% 41.2% 38.8% 38.8% 42.0% 42.0% Savings Savings 41.8% 41.8% 41.2% 41.2% 38.9% 38.9% Time Time
Slide 9: Lending growth - at constant currency
Lending growth -- atat constant constant currency currency US$m US$m 2000 2000 2001 2001 Growth Growth Personal Personal lending lending 114,013 114,013 125,463 125,463 10.0% 10.0% Corporate Corporate & & Commercial Commercial 148,766 148,766 153,671 153,671 3.3% 3.3% Growth Growth mainly mainly in
Slide 10: Market risk-related revenues in 2001
Market risk-related revenues in 2001 averaged US$13.9m a day (2000 US$10.0m a day) Daily Daily distribution distribution of of Market Market Risk Risk Revenues Revenues 20 20 Group Group Treasury Treasury Centres Centres 18 18 16 16 14 14 days of days C C P&L P&L frequency frequency 2001 2001 12 12
Slide 11: Costs 2001 compared with 2000 (cash basis)
Costs 2001 compared with 2000 (cash (cash basis) basis) US$m US$m 2001 2001 Total Total cost cost growth, growth, as as reported reported 1,028 1,028 7.6% FX FX translation translation 590 590 CCF CCF full full year year impact impact (760) (760) hsbc.com hsbc.com (164) (164) Other Other acquisition
Slide 12: Bad & doubtful debts charge
Bad & doubtful debts charge As As % % of of Gross Gross customer customer loans loans (excl (excl financial) financial) 1999 1999 2000 2000 2001 2001 New New specific specific 1.24% 1.24% 0.85% 0.85% 0.95% 0.95% Releases Releases & recoveries -0.36% -0.40% -0.43% -0.43% General General -0.02% -0.02%
Slide 13: Bad & doubtful debt charge
Bad & doubtful debt charge US$m 2000 US$m 2001 772 750 750 Cards $212m 662 Cards $297m 602 598 550 Release of Special general 550 provision: PFS USD 52m Commercial USD 87m 350 CIBM USD 35m 350 202 146 150 150 6 34 -50 -24 -50 -29 Personal Financial Services Commercial Banking Corporate, IB& M Privat
Slide 14: Bad & doubtful debts charge 2001
Bad & doubtful debts charge 2001 as as % % of of Line Line of of Business Business net net customer customer loans loans 2000 1.00% 0.81% 2001 0.67% 0.58% 0.50% 0.26% 0.16% 0.03% 0.05% 0.00% -0.27% -0.50% Personal Commercial Corporate, Private Financial Banking Investment Banking Services Banking &
Slide 15: Provisions for bad & doubtful debts
Provisions for bad & doubtful debts Europe Europe Hong Hong Rest Rest North North Latin Latin TOTAL TOTAL US$m US$m Kong Kong of of A-P A-P America America America America Opening Opening 3,025 3,025 1,802 1,802 2,091 2,091 723 723 556 556 8,197 8,197 Charged Charged off off (442) (442) (630) (630)
Slide 16: Non-performing loan evolution
Non-performing loan evolution US$m US$m CCF acquisition 4,000 4,000 3,000 3,000 2,000 2,000 1,000 1,000 00 Dec-97 Dec-97 Jun-98 Jun-98 Dec-98 Dec-98 Jun-99 Jun-99 Dec-99 Dec-99 Jun-00 Jun-00 Dec-00 Dec-00 Jun-01 Jun-01 Dec-01 Dec-01 Europe Europe North North America America Hong Hong Kong Kong Rest
Slide 17: Non-performing loan evolution
Non-performing loan evolution NPL’s NPL’s as as % % of of Gross Gross customer customer loans loans 15% 15% 10% 10% 5% 5% 0% 0% Dec-97 Dec-97 Jun-98 Jun-98 Dec-98 Dec-98 Jun-99 Jun-99 Dec-99 Dec-99 Jun-00 Jun-00 Dec-00 Dec-00 Jun-01 Jun-01 Dec-01 Dec-01 Europe Europe North North America America Hong
Slide 18: Argentina - Loan book
Argentina - Loan book (translated at 1.65:1) 31 31 December December 2001 2001 ARPm ARPm US$m US$m Residential Residential mortgages mortgages 434 434 263 263 Other Other personal personal 231 231 140 140 Property-related Property-related 97 97 59 59 Commercial, Commercial, Trade Trade & & other oth
Slide 19: Argentina - impact of mandatory conversion
Argentina - impact of mandatory conversion 31/12/01 31/12/01 Pre Pre crisis crisis measures Impact Impact of mandatory mandatory conversion conversion ARPbn ARPbn ARP ARP USD USD Total Total ARP ARP 1:1.65 1:1.65 1:1 1:1 1:1.4 1:1.4 Total Total Assets Assets 1.5 1.5 3.9 3.9 5.4 5.4 1.5 1.5 0.1 0.1 1
Slide 20: Per share analysis (cash basis)
Per share analysis (cash basis) US$ US$ 1.50 1.50 1.40 1.40 1.30 1.30 1.20 1.20 1.10 1.10 1.00 1.00 0.90 0.90 0.80 0.80 0.70 0.70 0.60 0.60 0.50 0.50 H1 H1 99 99 H2 H2 99 99 H1 H1 00 00 H2 H2 00 00 H1 H1 01 01 H2 H2 01 01 Revenues Revenues per per average average shares shares in in issue issue Tota
Slide 21: Per share analysis (cash basis)
Per share analysis (cash basis) US$ US$ 0.80 0.80 0.70 0.70 0.60 0.60 0.50 0.50 0.40 0.40 0.30 0.30 0.20 0.20 0.10 0.10 0.00 0.00 H1 H1 99 99 H2 H2 99 99 H1 H1 00 00 H2 H2 00 00 H1 H1 01 01 H2 H2 01 01 Operating Operating profit profit before before provisions provisions per per average average shar
Slide 22: Source and application of Tier 1 capital
Source and application of Tier 1 capital Opening Opening Tier Tier 11 ratio ratio 9% 9% US$m US$m 2001 2001 Tier Tier 11 capital capital Dec Dec 2000 2000 34,620 34,620 Scrip Scrip dividends dividends 866 866 Shares Shares issued issued 112 112 Attributable Attributable profits profits (cash (cash b
Slide 23: Some underlying business achievements
Some underlying business achievements ➣ ➣ Increased Increased share share of of UK UK new new mortgage mortgage lending lending toto 4.4% 4.4% from from 3.0% 3.0% ➣ ➣ Market Market leader leader inin provision provision ofof new new mortgages mortgages in in Malaysia Malaysia with with sales sales >
Slide 24: Selected acquisitions
Selected acquisitions ➣ Banque Hervet ➣ NRMA Building Society ➣ 8% of Bank of Shanghai ➣ Demirbank ➣ China Securities Investment Trust, Taiwan 2001 Results 24 =>? =>
Slide 25: Priorities for 2002
Priorities for 2002 ➣ Continue to implement the strategic plan •• retain retain traditional traditional cost cost discipline discipline •• enhance enhance position position in in Commercial Commercial segment segment •• build build on on strengths strengths inin Personal Personal Financial Financial
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