Slide 1: Q4'24 and FY'24 Results presentation
PUBLIC Global PowerPoint Cover page option 1 – SC gradient Q4’24 and FY’24 Results presentation 21 February 2025 21/02/2025
Slide 2: Strategy is working and results are strong
CONFIDENTIAL Strategy is working and results are strong Overview Income Expenses Delivered a strong performance in 2024 with record income, positive jaws and RoTE of 11.7% Impairment Balance sheet Capital Business update Strategy update Guidance Cross-border strategy well positioned to benefit from
Slide 3: Financial performance
CONFIDENTIAL Financial performance Diego De Giorgi Group Chief Financial Officer 3
Slide 4: Strong performance in 2024
CONFIDENTIAL Strong performance in 2024 $m Q4’24 YoY ccy FY’24 YoY ccy • FY’24 income up 14% YoY at ccy, or 12% excluding notable items of Overview $295m and $147m deposit insurance reclassification1 Net interest income (NII) 2,861 20% 10,446 10% Income Expenses − 2024 income growth above guidance N
Slide 5: 2024 NII growth supported by hedge roll-off and mix improvements
CONFIDENTIAL 2024 NII growth supported by hedge roll-off and mix improvements FY’24 NII ………………………………………………………………………………………………………..…………………….……… • FY’24 NII of $10.4bn, up 10% YoY at ccy Overview +8% ccy Income − Excluding the $147m deposit insurance reclassification1 Expenses to cost, NII is up 8% at
Slide 6: Strategy continues to drive broad-based non NII growth
CONFIDENTIAL Strategy continues to drive broad-based non NII growth Non-NII ($m) …………………………………………………………………………………………………….………………….………….. • Non NII is around half of Group income, and up 20% YoY Overview at ccy; or 16% excluding notable items1 Income +16% ccy Expenses • Growth driven by Wealth Solution
Slide 7: Expenses: On track to deliver 2026 target
CONFIDENTIAL Expenses: On track to deliver 2026 target Operating expenses1 movement ($m) ………………………………………….…………………………... • FY’24 expenses1 up 7% at ccy; or 6% excluding the $147m deposit Overview insurance reclassification from NII Income +7% ccy Expenses • QoQ increase includes the reclassification,
Slide 8: Fit for Growth programme progressing at pace
CONFIDENTIAL Fit for Growth programme progressing at pace FFG programme levers and project examples1 and estimated savings ……………………………… • Over 200 Fit for Growth (FFG) projects mobilised since Overview launch a year ago Income Matrix simplification: ~$60m Expenses • Efficiency saves already being re
Slide 9: Low levels of credit impairment
CONFIDENTIAL Low levels of credit impairment Credit impairment ($m) ….…………………………………………………………………………..……..………… • FY’24 credit impairment up 5% YoY to $557m Overview Income − Net release of $106m in CIB, as it benefitted from significant 178 130 Expenses 557 176 recoveries in the year, with offsetting
Slide 10: Low single-digit growth in customer loans and deposits in 2024
CONFIDENTIAL Low single-digit growth in customer loans and deposits in 2024 Loans and advances (L&A) to customers1 ($bn) ….………………………………………………..……… • Q4’24 underlying L&A to customers up 2% QoQ +2% Overview Income − CIB increase from Global Banking, partly offset by Trade 287 Expenses 5 281 274 2 Imp
Slide 11: Robust capital position, risk-weighted assets well managed
CONFIDENTIAL Robust capital position, risk-weighted assets well managed Risk-weighted assets ($bn) ….…………………………………………………………................................... • Q4’24 risk-weighted assets (RWA) down $2bn QoQ Overview Income ($1.9bn) − Asset growth and mix up $5bn mainly from CIB Expenses 5.2 248.9 I
Slide 12: On track to deliver at least $8bn shareholder distribution target
CONFIDENTIAL On track to deliver at least $8bn shareholder distribution target Shareholder distributions ….………………………………………………………………………….……. • $4.9bn total distributions to shareholders announced since Overview full year 2023 results $4.9bn total shareholder distributions announced since FY’23 result
Slide 13: CIB: 2024 performance
CONFIDENTIAL CIB: 2024 performance CIB ($m) Q4’24 YoY ccy FY’24 YoY ccy • FY’24 income of $11.8bn, up 6% YoY at ccy; Q4’24 up 15% YoY at ccy Overview Transaction Services 1,666 1% 6,434 - Income • Global Markets up 15% YoY at ccy in 2024 Expenses Global Markets 773 47% 3,450 15% Impairment − Flow in
Slide 14: WRB: 2024 performance
CONFIDENTIAL WRB: 2024 performance WRB ($m) Q4’24 YoY ccy FY’24 YoY ccy • FY’24 income up 11% YoY at ccy, with double-digit growth in Overview Wealth Solutions from broad-based growth across products Investment Products4 451 52% 1,825 36% Income Expenses Bancassurance 110 (4%) 663 14% − Q4’24 WRB up
Slide 15: Ventures: Key highlights
CONFIDENTIAL Ventures: Key highlights Deposits $bn Lending $bn • 2024 income up 15% YoY Overview Income • ~650k customers in 2024, equivalent to >10% of Hong Kong’s bankable population 1; Expenses average of 3.1x products per customer in 2024 Impairment 0.8 0.8 Balance sheet 2.2 • First digital bank
Slide 16: Upcoming changes in our financial disclosure
CONFIDENTIAL Upcoming changes in our financial disclosure C&O items allocation to businesses …………………………………………………………………… Principle Overview Income • Allocate some of the centrally held treasury economics and Expenses corporate centre costs to the underlying business segments Treasury income Impairmen
Slide 17: Strategy update
CONFIDENTIAL Strategy update Bill Winters Group Chief Executive 17
Slide 18: Accelerating progress
CONFIDENTIAL Accelerating progress Delivering sustainably higher returns Overview Income 11.7% Expenses 10.1% Impairment 7.7% Balance sheet 6.3% 6.5% Underlying RoTE Capital 4.7% 3.9% 3.2% Business update Strategy update -0.4% 0.3% Guidance FY'15 FY'16 FY'17 FY'18 FY'19 FY'20 FY'21 FY'22 FY'23 FY'24
Slide 19: On track to achieve our medium-term targets in CIB
CONFIDENTIAL On track to achieve our medium-term targets in CIB Cross-border network income as a % of CIB income2 …………………………….......................... • FY’24 network income is 61% of total CIB income Overview Income − Expected to grow to ~70% over the medium-term 70% Expenses Impairment • Financia
Slide 20: Continued focus on cross-border clients in CIB
CONFIDENTIAL Continued focus on cross-border clients in CIB… Cross-border (network) income ……………..................................................................................... • FY’24 cross-border (network) income of $7.3bn Outbound Inbound Overview Income − Growing at ~11% CAGR since 2019; ~9
Slide 21: With network income well-diversified across the footprint
CONFIDENTIAL … With network income well-diversified across the footprint ~One-third of network income is intra-Asia ………………………............................ Capturing supply chain shifts in ASEAN ………………………………………………….…. Overview Income Expenses Impairment Balance sheet Capital Business update Strategy u
Slide 22: WRB continues to build on strengths with affluent clients
CONFIDENTIAL WRB continues to build on strengths with affluent clients Client metrics ………………………………………………………….………………………………………….. • 295k individual clients up-tiered in 2024; on track to achieve 800k-1m Overview up-tier target through 2026 Individual clients up-tiered2 International clients3 Income Ex
Slide 23: Strong sustainable finance income; well on track to deliver target
CONFIDENTIAL Strong sustainable finance income; well on track to deliver target Sustainable finance income ………………………………………………………….……………………………………… • Sustainable finance income up 36% YoY to $982m in 2024 Overview Sustainable finance income Global renewables investment3 Income − Broad-based growth acr
Slide 24: Guidance
CONFIDENTIAL Guidance Overview Guidance1 Income Expenses Impairment Balance sheet Capital Operating income Business update to increase 5-7% CAGR Strategy update in 2023-2026, tracking Guidance Return at least $8bn towards upper end of Operating expenses2 Positive jaws CET1 ratio of capital to shareh
Slide 25: Appendices
CONFIDENTIAL Appendices 25
Slide 26: 2025 and 2026 guidance
CONFIDENTIAL 2025 and 2026 guidance 2025 guidance 2026 guidance Income • 5-7% CAGR in 2023-20262,3, currently tracking towards upper end of the • 2025 growth expected to be below 5-7% range1 range • Positive income-to-cost jaws in each year excluding the two notables1 • Expenses to be below $12.3bn4
Slide 27: Income by product
CONFIDENTIAL Income by product Q4’24 YoY ($m) YoY ccy FY’24 YoY ($m) YoY ccy Payments & Liquidity 1,193 (14) (1%) 4,605 (40) (1%) Securities & Prime Services 161 21 15% 611 61 12% Trade & Working Capital 325 13 5% 1,268 (55) (2%) Transaction Services 1,679 20 1% 6,484 (34) - Lending & Financial Solu
Slide 28: Significant and notable items
CONFIDENTIAL Significant and notable items Deposit insurance reclassification ……………………………………….….……..………………………...... Notable items …………………………………………………………………………………………………………...….. • Deposit insurance payments and similar charges in other markets had Revaluation of FX position in Egypt been recognised w
Slide 29: Interest rate assumptions
CONFIDENTIAL Interest rate assumptions Currency-weighted average1 (bps) ……………………………………………………………..……. Dec’24 weighting by top-10 currencies ……………………………………………….…………… 446 454 447 417 446 454 447 MYR 389 TWD 367 5% USD 412 356 347 6% GBP 19% 381 357 6% 339 329 SGD 8% 13% HKD 10% Q1'24 Q2'24 Q3'24 Q4'24
Slide 30: Hedging strategy reducing NII volatility
CONFIDENTIAL Hedging strategy reducing NII volatility Interest rate risk in the banking book ……………………………………………………………..……….….. • FY’24 NII sensitivity has reduced by $340m YoY Annualised impact to banking book NII from instantaneous -100bps parallel shift in interest rates − ~50% on an increase in st
Slide 31: Tangible net asset value per share
CONFIDENTIAL Tangible net asset value per share Basic # of Tangible equity TNAV per share ordinary shares2 ($m) (cents) (m) As of 30.9.24 37,486 1,509 2,484 Profit attributable to ordinary shareholders 522 21 Movement in intangible assets 488 20 Dividends paid to: Ordinary shareholders - - Other equ
Slide 32: Limited Hong Kong CRE exposure; mostly secured
CONFIDENTIAL Limited Hong Kong CRE exposure; mostly secured Hong Kong CRE exposure3 ($bn) by credit grade4 ……………… • $2.6bn portfolio book is <0.5% of total Group exposures1 0% − 82% secured2 with average LTV2 at <40%; all property collateral located in Hong Kong CG 1-53 − Unsecured exposures down 31
Slide 33: China portfolio resilient and CRE well provisioned
CONFIDENTIAL China portfolio resilient and CRE well provisioned China ultimate parent company exposure5 ($bn) ……….…………………………. • China portfolio is resilient and undergoes regular reviews and stress testing − Top exposures only with blue chip state- and privately-owned enterprises 3% Corporates 10% 3
Slide 34: Information for fixed income investors
CONFIDENTIAL Information for fixed income investors 34
Slide 35: Strong performance founded on a diverse franchise
CONFIDENTIAL Strong performance founded on a diverse franchise 53 $19.7bn $6.8bn 59% 11.7% Markets Operating income1 PBT1 Cost income ratio1 RoTE1 (FY’23: $17.4bn) (FY’23: $5.7bn) (FY’23: 63%) (FY’23: 10.1%) Group income diversified by market and segment1 ($bn)……….……. Group income diversified by pro
Slide 36: Strong foundations from a diversified balance sheet
CONFIDENTIAL Strong foundations from a diversified balance sheet Capital metrics ……………………………………………………………………………………………………………….. Liquidity metrics …………………………………………………………………………………………………………….. 14.2% 34.2% 4.8% 138% 135% 53% CET1% MREL% Leverage ratio LCR1 NSFR2 Advances-to-deposits min. requirement: min.
Slide 37: Balance sheet is conservatively positioned
CONFIDENTIAL Balance sheet is conservatively positioned Balance sheet …………………………….……………………………………………………………………………... • Highly liquid and flexible balance sheet Total assets Total equity & liabilities − ~60% of total assets mature in under 1 year 31.12.24 Movements since 31.12.24 Movements since $850bn
Slide 38: Strong and diverse deposit base; franchise delivers deposit quality
CONFIDENTIAL Strong and diverse deposit base; franchise delivers deposit quality Customer deposits by market4 ($bn) …………………………………………………………….…. • Well-diversified deposit base across 53 markets Hong Kong India − In Hong Kong & Singapore we are a Domestic SIB1 12% Singapore Taiwan • 53% CIB deposits,
Slide 39: Deposit mix within expectations; PTRs managed assertively
CONFIDENTIAL Deposit mix within expectations; PTRs managed assertively Transaction Services CASA% of CIB deposits3 ($bn) …………………….. • CASA/TD mix stable in CIB, WRB TDs up YoY on Wealth momentum 64% 64% 64% 62% 65% − Short-term CIB TDs grew in Q3 before normalising in Q4 post rate cuts CASA % Other
Slide 40: High levels of liquid resources and stable funding
CONFIDENTIAL High levels of liquid resources and stable funding Components of Liquidity coverage ratio (LCR) ……………………………….…….. • LCR of 138%1 down 5%pts QoQ due to: 145% 143% − Ongoing Treasury liability optimisation actions and LCR normalisation 138% − Some seasonal CASA outflows, which have largel
Slide 41: Managing capital and leverage buffers above requirements
CONFIDENTIAL Managing capital and leverage buffers above requirements CET1 position materially above requirements1,2 ………………………………………..…………….. • Minimum CET1 requirement broadly unchanged at 10.5% CET1% − Hong Kong CCyB reduction in October offset Korea CCyB increase 14.2% 14.2% 14.1% − No material c
Slide 42: MREL: Well-positioned for future growth and requirements
CONFIDENTIAL MREL: Well-positioned for future growth and requirements External MREL position versus requirements ………………………………………………………. • MREL ratio of 34.2% meets requirements with a buffer of ~660bps 34.2% • Total Group MREL of ~$85bn • MREL requirement is higher of: $16.4bn 27.6% PLC Senior − 2 x
Slide 43: Good progress on delivery of funding programme
CONFIDENTIAL Good progress on delivery of funding programme Maturity and Call schedule of existing stock ($bn)1,2 ……………………..….. • We expect to be a net negative issuer of MREL in 2025 8.9 • 2025 MREL issuance plan of around $7bn with near term focus on Holdco Senior 1.3 AT1 7.6 − 1Q’25 issued $3.5bn
Slide 44: Stronger risk foundations supporting resilient performance
CONFIDENTIAL Stronger risk foundations supporting resilient performance Risk indicators ………………………………………………………………………………………………………….. • Key portfolio indicators improved since FY’14 reflecting: bps − Strengthening the Group’s risk culture and tightened risk appetite 200 100% 180 − Diverse by industry s
Slide 45: Group strategy to support and, over time, improve credit ratings
CONFIDENTIAL Group strategy to support and, over time, improve credit ratings Senior long-term and short-term ratings • Well-rated with strong credit fundamentals, absolutely & relative to peers − Well-established network is a strength S&P Moody’s Fitch − Funding and liquidity are key strengths A+ A
Slide 46: Standard Chartered Group: simplified legal structure
CONFIDENTIAL Standard Chartered Group: simplified legal structure Standard Chartered PLC MREL: Holdco Senior, Tier 1 & AT1 BBB+/A31/A Equity (S&P/Moody’s/Fitch) CP / CDs Standard Chartered Bank Standard Chartered Bank (Hong Kong) Medium Term Notes A+/A11/A+ A+/A12/- Structured Products Principal Bra
Slide 47: Select technical and abbreviated terms
CONFIDENTIAL Select technical and abbreviated terms Term Definition Term Definition Adj. Adjustments EA (NPP) Early alerts (non-purely precautionary) AIEA Average interest-earning assets A borrower’s account which exhibits risks or potential weaknesses of a AAME Asia, Africa and the Middle East mate
Slide 48: Select technical and abbreviated terms
CONFIDENTIAL Select technical and abbreviated terms Term Definition Term Definition MAS Monetary Authority of Singapore RMs Relationship Managers MDA Maximum distributable amount RoRWA Return on risk-weighted assets MiFID Markets in Financial Instruments Directive RWA Risk-weighted assets. A measure
Slide 49: Important notice
CONFIDENTIAL Important notice Forward-looking statements The information included in this document may contain ‘forward-looking statements’ based upon current expectations or beliefs as well as statements formulated with assumptions about future events. Forward-looking statements include, without li