Hsbc Holdings Plc · LSE:HSBA
Hsbc — Corporate Update (March 2019)
26 slides from Hsbc's corporate update, March 2019
Slide 1: HSBC Holdings plc US business update
HSBC Holdings plc US business update March 2019
Slide 2: Contents
Contents Financial and strategic overview 3 US global business update 9 Appendix 17 Glossary 24 Footnotes 25 2
Slide 3: US 2020 vision and strategy summary
Financial and strategic overview US 2020 vision and strategy summary Be the leading international bank in the US augmented with domestic offerings for scale while Vision continuing to fulfil role as a key network market for the HSBC Group Organically grow in strategic segments to: Serve the domest
Slide 4: 2020 strategy is dependent on organic growth in our core businesses
Financial and strategic overview 2020 strategy is dependent on organic growth in our core businesses Accelerate revenue growth: - CMB: grow customer numbers among US subsidiaries of international corporates and internationally-focused US corporates Actions to - RBWM: increase penetration of intern
Slide 5: Key financial messages
Financial and strategic overview Key financial messages The US is on track to deliver >6% RoTE by 20201 US Principal Business $1bn adjusted PBT, up 8% vs 2017 driven by: - Modest revenue growth - Favorable credit environment - Delivered cost efficiencies RoTE1 improved from 0.9% to 2.7% year on
Slide 6: US Principal Business: 2018 financial overview
Financial and strategic overview US Principal Business: 2018 financial overview Adjusted financial metrics Adjusted PBT by global business $m 2017 2018 $m Growth, +8% 2018 Δ2017 YoY 996 Revenue 4,792 55 1% 920 +17% LICs / ECL 199 81 69% +9% 618 Operating expenses (3,996) (60) (2)% 527 473 >200% 432
Slide 7: US strategy is looking to deliver 2020 RoTE > 6% and aspires to build the leading international bank
Financial and strategic overview US strategy is looking to deliver 2020 RoTE1 > 6% and aspires to build the leading international bank in the US 2017 2018 – 2020 2020+ US market highly strategic and HSBC US largest outbound exporter, but… Strategic actions Leading international bank in the US: Ful
Slide 8: Conditions are right to become the leading international bank in the US
Financial and strategic overview Conditions are right to become the leading international bank in the US Ability to implement Role of US is highly Proven international Strong local management Significant market technology and Foundation for growth strategic network opportunity team with Group suppor
Slide 9: CMB continues to execute its strategy with a focus on client growth
US global business update 1 CMB continues to execute its strategy with a focus on client growth, targeting internationally-connected companies Over 70k internationally-connected companies in the US 500+ new clients in 2018 generating a higher rate of revenue # of companies in US with annual turnover
Slide 10: CMB is supported by the strength and reach of the global network
US global business update 1 CMB is supported by the strength and reach of the global network CMB’s global presence is helping to drive US success… …with consistent double-digit inbound growth # foreign companies with US subsidiary operations5 Inbound customer value ($m) Priority corridors: China
Slide 11: CMB is assisted by key investments in product areas and operational improvements
US global business update 1 CMB is assisted by key investments in product areas and operational improvements Investment in products is improving client penetration Streamlining of operations is improving the client experience Net* revenue from CMB clients in GB&M products ($m) Account opening times
Slide 12: RBWM has strong customer growth driven by unsecured products
US global business update 1 RBWM has strong customer growth driven by unsecured products US credit card customer acquisitions Credit cards and unsecured loans Number of new customers (‘000s) The US credit card industry is close to a $1tn market and is +171% growing at >4%6 CAGR for the last four y
Slide 13: RBWM is well positioned to serve international customers
US global business update 1 RBWM is well positioned to serve international customers Sources of international customer acquisition9 HSBC US opportunity US immigrant population (m) US immigrant inflow (m/yr) Opportunity to capture additional market share in the 41 1.3 international space, which is
Slide 14: GB&M grew revenue and gained market share in key areas
US global business update 2 GB&M grew revenue and gained market share in key areas Collaborating with CMB Driving US’s contribution to Group Gaining market share in areas of strategic focus Net* revenue from CMB clients ($m) Outbound customer value ($bn) Product +/- Market Position c.20% 34% DCM IG1
Slide 15: GB&M is investing to build strength in high potential growth areas
US global business update 2 GB&M is investing to build strength in high potential growth areas Expanding coverage in sectors Providing market access and liquidity Growing structured finance US DCM and Loan Fees Revenue Pool14 ($bn) Sales and trading revenue ($m) Credit financing revenue ($m) = Recen
Slide 16: Replacing core banking platform first step in reengineering the firm
US global business update 3 Replacing core banking platform first step in reengineering the firm Actions Benefits Aligned US IT infrastructure to Group HSBC Universal Allows US to take full advantage of Group innovation Banking (HUB) platform investments and more effectively compete with larger
Slide 17: Appendix
Appendix
Slide 18: Reconciliation of adjusted to reported results
Appendix Reconciliation of adjusted to reported results PBT ($m) 2018 2017 Adjusted Reported US Adjusted Reported US Significant CML run-off Significant CML run-off US Principal Principal Reported US US Principal Principal Reported US items portfolio items portfolio Business Business Business Busine
Slide 19: Simplified structure chart
Appendix Simplified structure chart Holding company Relevant US Entities Associate HSBC Intermediate holding company Holdings plc Resolution entity UK Operating company 99.9% HSBC HSBC HSBC Private HSBC HSBC HSBC Asia North 94.5% Bank HSBC UK Banking Mexico, Bank Holdings Ltd America Egypt Holdings
Slide 20: Biographies
Appendix Biographies Pat Burke is President and CEO of HSBC North America Holdings Inc., and also serves as Chairman of HSBC Bank USA, N.A., HSBC USA Inc., and HSBC Global Asset Management (USA) Inc. He took up these roles in November 2014. He oversees HSBC Holdings plc’s US businesses which serve d
Slide 21: Biographies
Appendix Biographies André Brandão was appointed Head of Global Banking and Markets for the Americas on 1 July 2018, responsible for the business in Canada, the US and Latin America. He was appointed a Group General Manager in January 2013 and is a member of both Global Banking and Markets and HSBC
Slide 22: Biographies
Appendix Biographies Pablo Sanchez is the Head of Retail Banking and Wealth Management (RBWM) for the US and Canada at HSBC. In this role, he leads the RBWM business in the US and has oversight of the same business in Canada. Pablo also serves on the HSBC US executive committee and the Global Retail
Slide 23: Biographies
Appendix Biographies Over ten years, Jeff has served in a number of US and Global roles with HSBC. His most recent role at HSBC was as Chief of Staff and Head of Strategy & Planning for Global Commercial Banking. He has also held various international and US-based operating and strategic planning ro
Slide 24: Glossary
Appendix Glossary CAGR Compound annual growth rate LICs Loan impairment charges and other credit risk provisions In December 2016, certain functions were combined to MENA Middle East and North Africa create a Corporate Center. These include Balance Sheet Management, legacy businesses and interests i
Slide 25: Footnotes
Appendix Footnotes 1. RoTE calculated on an HSBC North America Holdings legal entity basis (including CML), and excludes significant items. 2017 RoTE also excludes the adverse impact from the one-time write-down of deferred tax assets due to US Tax Reform. Including this adverse impact, 2017 RoTE wa
Slide 26: Disclaimer
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 an offer to se