Hsbc Holdings Plc · LSE:HSBA
Hsbc — Q3 2024 Earnings Presentation
38 slides from Hsbc's earnings presentation, Oct 29, 2024
Slide 1: HSBC Holdings plc 3Q24 Results
HSBC Holdings plc 3Q24 Results Presentation to Investors and Analysts
Slide 2: Simplified organisational structure to accelerate strategic execution
Simplified organisational structure to accelerate strategic execution Four connected businesses Focus on increasing leadership and Hong Kong market share where we have a competitive advantage and the UK greatest opportunities to grow Corporate and Institutional Banking, covering clients global
Slide 3: 3Q24 results
3Q24 results Jonathan Bingham Interim Group Chief Financial Officer
Slide 4: 3Q24 summary
3Q24 results Appendix 3Q24 summary $8.5bn PBT, +$0.9bn / +11% vs. 3Q23 1 19.3% RoTE / 16.7% excluding notable items* $17.0bn revenue, +$1.1bn / +7% vs. 3Q23, including strong performances in Wealth and Wholesale 2 Transaction Banking fee and other income; Banking NII run-rate broadly stable QoQ 3 $(
Slide 5: Financial performance
3Q24 results Appendix Financial performance Constant currency, $bn 3Q23 3Q24 Δ, $ Δ, % $8.5bn PBT, up 11% vs 3Q23 on a constant currency basis / up 13% Revenue 15.9 17.0 1.1 7% excluding notable items and the impact of strategic transactions ECL (1.0) (1.0) 0.1 5% $9.00 TNAV per share, up $0.65
Slide 6: Revenue
3Q24 results Appendix Revenue $17.0bn, up $1.1bn / 7% vs. 3Q23 Up $1.6bn / 10% excluding notable items and strategic transactions 3Q24 vs. Constant currency, $bn 3Q23 3Q24 3Q23 Banking NII 3Q24 included $(0.3)bn loss on early 11.1 10.6 (0.5) redemption of legacy securities (notable item) Fee and oth
Slide 7: Banking NII
3Q24 results Appendix Banking NII QoQ run-rate stable Banking NII (reported FX), $bn 11.5 11.3 Banking NII of $10.6bn, down $(0.3)bn vs. 0.3 0.3 10.9 10.6 2Q24, due to notable items (loss on early 0.4 10.7 redemption of legacy securities) 0.5 0.4 0.3 0.3 0.0 FY24 Banking NII guidance of ~$43bn1 unch
Slide 8: Fee and other income: Wholesale Transaction Banking and Wealth
3Q24 results Appendix Fee and other income: Wholesale Transaction Banking and Wealth Strong Q3 performance, particularly in Wealth Wholesale Transaction Banking: up 7%, primarily FX Wealth: up 32%, with growth in all products $bn $bn +7% +32% vs. 3Q23 vs. 2.6 2.6 2.7 2.0 3Q23 2.5 2.6 1.8 GTS 3% 1.8
Slide 9: Credit performance
3Q24 results Appendix Credit performance (28)bps annualised ECL charge in 9M241, broadly in line with guidance ECL charge trend, $bn (39)bps (35)bps (40)bps (28)bps (13)bps (1.0) (0.9) (1.0) (0.7) $(1.0)bn 3Q24 ECL charge, including: (0.3) $(0.6)bn Wholesale, primarily $(0.4)bn in 3Q23 4Q23 1Q24
Slide 10: Costs
3Q24 results Appendix Costs On track to meet cost growth of ~(5)% vs. FY231 $bn* 9M23 9M24 Constant currency costs (23.1) (24.4) Less: notable items 0.1 0.1 Add: impact of retranslating results of hyperinflationary (0.5) — Target basis costs up (6)% vs. 9M23, primarily economies at constant curren
Slide 11: Customer loans and deposits
3Q24 results Appendix Customer loans and deposits Loans stable; deposits up 1% driven by Hong Kong WPB Customer loans, $bn +0% 969 Wholesale (1) 1 967 3 (0) (1) GBM +$2bn CMB 2Q24 Loans moved Hong Kong UK RFB Rest of Asia Other 3Q24 to held for sale* Customer deposits, $bn +1% +$16bn WPB, including
Slide 12: Capital and distributions
3Q24 results Appendix Capital and distributions $4.8bn distributions announced CET1 ratio, % CET1 ratio 15.2%, +0.2ppts vs. 2Q24 +0.8 Upcoming impacts 4Q24 (0.4) +0.3 15.2 15.0 Up to $3bn share buyback — expect (0.4)ppts +0.1 impact on the CET1 ratio in 4Q242 (0.4) (0.2) Argentina sale expected
Slide 13: Outlook
3Q24 results Appendix Outlook Guidance unchanged 1 RoTE in the mid-teens for FY24 and FY25, excluding notable items 2 FY24 Banking NII of ~$43bn1 3 FY24 ECL charge to be within our medium-term planning range of (30) to (40)bps2 4 Cost growth in FY24 of approximately (5)% vs. FY23, on a target basis3
Slide 14: Appendix
Appendix
Slide 15: Group guidance summary
3Q24 results Appendix Group guidance summary Around $43bn in FY24, based on our current forecasts using market implied interest rates as of mid-October 2024. This Banking NII guidance remains dependent on the path of interest rates globally FY24 ECL charge to be within our medium-term planning range
Slide 16: Financial performance summary
3Q24 results Appendix Financial performance summary $m 3Q23 4Q23 1Q24 2Q24 3Q24 Δ 3Q23 NII 8,818 7,732 8,548 8,279 7,637 (13)% Non-NII 7,069 4,932 12,181 8,377 9,361 32 % Revenue 15,887 12,664 20,729 16,656 16,998 7% ECL (1,038) (927) (697) (326) (986) 5% Costs (7,823) (8,532) (8,149) (8,214) (8,143
Slide 17: Banking NII
3Q24 results Appendix Banking NII NII to Banking NII, $bn Reported FX, $bn 3Q23 4Q23 1Q24 2Q24 3Q24 ∆ 2Q24 9M23 9M24 NII 9.2 8.3 8.7 8.2 7.6 (0.6) 27.5 24.5 Less: insurance NII (0.1) (0.1) (0.1) (0.1) (0.1) (0.0) (0.3) (0.3) Central costs of funding trading income1 2.4 2.5 2.7 2.8 3.1 0.3 6.1 8.6 Ba
Slide 18: Reported net interest margin
3Q24 results Appendix Reported net interest margin Quarterly NIM by key legal entity (reported FX basis) Group NIM, bps (reported FX basis) % 3Q24 % 3Q24 162 3Q23 4Q23 1Q24 2Q24 3Q24 NII AIEA (5) (3) (2) Asia 1.85% 1.73% 1.66% 1.63% 1.58% 48% 45% (4) 146 (2) HSBC Bank plc 0.53% 0.50% 0.35% 0.35% 0.1
Slide 19: Wholesale Transaction Banking and Wealth – additional information
3Q24 results Appendix Wholesale Transaction Banking and Wealth – additional information Constant currency basis, $m 3Q23 4Q23 1Q24 2Q24 3Q24 vs. 3Q23 Wholesale Transaction Banking revenue 6,671 6,730 6,654 6,534 6,627 (44) (1)% Of which: Fee and other income 2,504 2,554 2,591 2,645 2,676 172 7% — Fo
Slide 20: Wealth — Global invested assets
3Q24 results Appendix Wealth — Global invested assets Reported FX basis Global reported invested assets Asia reported invested assets $bn $bn +20% +28% +9% +6% 662 1,271 1,348 606 1,122 518 116 104 469 511 85 205 410 185 157 346 390 397 276 318 340 366 412 440 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 Retail GP
Slide 21: ECL charge by legal entity
3Q24 results Appendix ECL charge by legal entity Constant currency, $m 3Q23 4Q23 1Q24 2Q24 3Q24 Asia (749) (438) (272) (184) (536) o/w Hong Kong (661) (376) (235) (153) (457) o/w mainland China CRE (503) (195) (54) (72) (101) UK RFB (59) (49) (54) (10) (173) HSBC Bank plc (81) (60) (67) 136 (3) US 1
Slide 22: FY24 cost target basis reconciliation
3Q24 results Appendix FY24 cost target basis reconciliation $m FY23 9M23 9M24 1Q24 2Q24 3Q24 Costs* (31,666) (23,067) (24,439) (8,151) (8,145) (8,143) Less: Notable items 187 120 127 50 32 45 Add: Impact of retranslating prior period results in (734) (487) — — — — hyperinflationary economies at cons
Slide 23: Notable items
3Q24 results Appendix Notable items Reported FX basis, $m 3Q23 4Q23 1Q24 2Q24 3Q24 Revenue (268) (2,733) 3,732 (161) (211) o/w: Disposals, acquisitions and related costs 310 (2,333) 3,732 (161) 72 o/w: Disposal losses on Markets Treasury repositioning (578) (399) — — — o/w: Early redemption of legac
Slide 24: EPS excluding material notable items and related impacts
3Q24 results Appendix EPS excluding material notable items and related impacts Reported FX basis, $m 3Q23 4Q23 1Q24 2Q24 3Q24 9M23 9M24 PAOS 5,619 (153) 10,183 6,403 6,134 22,585 22,720 Impact of acquisition of SVB UK (86) 44 — (2) — (1,593) (2) Impact of the sale of our retail banking operations in
Slide 25: Reconciliations: Impact of notable items and strategic transactions
3Q24 results Appendix Reconciliations: Impact of notable items and strategic transactions $m 3Q23 3Q24 Reported revenue 16,161 16,998 Currency translation (274) — Constant currency revenue 15,887 16,998 Notable items — related to strategic transactions 320 73 Revenue and PBT reconciliations include
Slide 26: Argentina
3Q24 results Appendix Argentina Reported FX basis, $m 3Q23 4Q23 1Q24 2Q24 3Q24 9M23 9M24 Announced agreement to sell the business on 9 April 2024 NII 355 13 488 434 264 981 1,186 In 9M24, recognised a $(1.2)bn impairment loss Non-NII (108) (42) (290) (125) (52) (178) (468) following the classifi
Slide 27: Balance sheet – customer lending
3Q24 results Appendix Balance sheet – customer lending Balances by global business, $bn Balances by entity Growth since 2Q24 $(2)bn 975 967 969 Asia (HBAP) $461bn (0)% GBM o/w: Hong $(1)bn 179 179 175 $276bn Kong (0)% $3bn UK RFB (HBUK) $289bn 1% CMB 318 319 322 HSBC Bank plc $(1)bn $112bn (HBEU) (1
Slide 28: Balance sheet – customer accounts
3Q24 results Appendix Balance sheet – customer accounts Balances by global business, $bn Balances by entity Growth since 2Q24 $22bn Asia (HBAP) $836bn 1,641 1,661 3% 1,625 o/w: Hong $18bn Kong $565bn GBM 324 343 342 3% $4bn UK RFB (HBUK) $358bn 1% HSBC Bank plc $(12)bn CMB 477 481 487 $299bn (HBEU)
Slide 29: 3Q24 vs. 2Q24 equity drivers
3Q24 results Appendix 3Q24 vs. 2Q24 equity drivers Shareholders’ Tangible equity, TNAV per share, Basic number of ordinary Reported FX basis equity, $bn $bn $ shares, millions At 30 June 2024 183.3 153.1 8.35 18,330 Profit attributable to: 6.5 6.6 0.36 — Ordinary shareholders1 6.1 6.6 0.36 — Other e
Slide 30: Total shareholders’ equity to CET1 capital
3Q24 results Appendix Total shareholders’ equity to CET1 capital 3Q24 total equity to CET1 capital (reported FX), $m Total equity to CET1 capital walk (reported FX), $m 1Q24 2Q24 3Q24 Total equity 200,025 Total equity (per balance sheet) 198,377 190,414 200,025 Non-controlling interests (7,191) (7,1
Slide 31: Wealth and Personal Banking
3Q24 results Appendix Wealth and Personal Banking Revenue 3Q24 vs. 3Q23 Revenue up $0.8bn, including $(0.3)bn impacts from strategic vs. 3Q23 transactions. Excluding these, up $1.1bn / 18% o/w: strategic $m 3Q23 2Q24 3Q24 $ % transactions Wealth +$0.5bn, including $(0.1)bn impacts from strategic tra
Slide 32: Commercial Banking
3Q24 results Appendix Commercial Banking vs. 3Q23 Revenue 3Q24 vs. 3Q23 $m 3Q23 2Q24 3Q24 o/w: strategic Revenue up 2%. Excluding the impact of strategic $ % transactions revenue up $0.4bn / 8%, driven by transaction transactions Global Payments Solutions 3,131 2,961 2,946 (185) (6)% (83) banking fe
Slide 33: Global Banking and Markets
3Q24 results Appendix Global Banking and Markets vs. 3Q23 Revenue 3Q24 vs. 3Q23 $m 3Q23 2Q24 3Q24 o/w: strategic $ % transactions Revenue $4.4bn, up $0.6bn, 15%: Securities Services 605 578 564 (41) (7)% — Global Debt Markets 159 234 259 100 63% (5) Client driven transactions remain elevated, supp
Slide 34: Corporate Centre
3Q24 results Appendix Corporate Centre vs. 3Q23 Revenue 3Q24 vs. 3Q23 o/w strategic Revenue down by $(0.4)bn, primarily reflecting: $m 3Q23 2Q24 3Q24 $ % transactions $(0.3)bn loss on the early redemption of legacy Central Treasury securities 17 (35) 68 51 > 100% — $(0.2)bn non-recurrence of 3Q2
Slide 35: Glossary
3Q24 results Appendix Glossary AIEA Average interest earning assets EPS Earnings per share AT1 Additional Tier 1 FVOCI Fair value through other comprehensive income Banking net interest income is an alternative performance measure, and is GBM Global Banking and Markets, a global business defined as
Slide 36: Footnotes
3Q24 results Appendix Footnotes Slide 3: 3Q24 summary 4. The medium term is defined as 3-4 years from 1 January 2024 and the long term is defined as 5-6 years from 1 1. Charge as a percentage of average gross loans, including held-for-sale balances January 2024 2. On a target basis, which excludes t
Slide 37: Disclaimer
3Q24 results Appendix Disclaimer Important notice The information, statements and opinions set out in this presentation and accompanying discussion (this “Presentation”) are for informational and reference purposes only and do not constitute a public offer for the purposes of any applicable law or a
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