Hsbc Holdings Plc · LSE:HSBA
Hsbc — Non-Deal Roadshow (December 2007)
43 slides from Hsbc's roadshow presentation, Dec 4, 2007
Slide 1: New York City Investor Roadshow
New York City Investor Roadshow 4 December 2007
Slide 2: Disclosure statement
Disclosure statement This presentation, including the accompanying slides and subsequent discussion, contains certain forward-looking information with respect to the financial condition, results of operations and business of HSBC Holdings plc and HSBC USA Inc. This information represents expectation
Slide 3: Presentations
Presentations • HSBC USA Inc – Strategic Overview Paul Lawrence • Financial Overview Gerard Mattia • Corporate, Investment Banking and Markets Paul Lawrence, Jose-Luis Guerrero • Personal Financial Services Kevin Newman • Commercial Banking Chris Davies 2
Slide 4: HSBC USA Inc Strategic Overview
HSBC USA INC Strategic Overview PAUL LAWRENCE, PRESIDENT AND CEO 4 December 2007 HSBC BANK USA INC
Slide 5: Legal entity structure
Legal entity structure HSBC Holdings plc HSBC North America Holdings Inc HSBC Finance Corporation HSBC USA Inc * HSBC Markets (USA) Inc HSBC Bank Canada HSBC Bank USA, NA HSBC Securities (USA) Inc * HSBC USA Inc will be referred to as ‘HUSI’ throughout this presentation. This is the principal bank s
Slide 6: Management team
Management team Paul Lawrence President and CEO, HSBC Bank USA, NA Head of CIBM, North America CIBM PFS CMB Private Bank P Lawrence K Newman C Davies M Young Chief Operating Officer Chief Risk Officer Chief Financial Officer General Counsel Human Resources D Dew G Wendler G Mattia J Burak J Ebersole
Slide 7: Joining up for profitable growth – our Global Pillars
Joining up for profitable growth – our Global Pillars • Our customers – Service excellence • Our brand – The world’s local bank • Our culture – the best place to work • Our global distribution – Our global advantage • Our business – Building for sustained growth • Our technology and process – Joinin
Slide 8: Strategic objectives
Strategic objectives • Right-sized and joined up • Establish legitimate and credible competitive positioning • Leverage Group advantages with focus on international requirements of customers • Define clear business propositions and strategies • Align business initiatives to our Global Pillars • Impr
Slide 9: Tactical initiatives
Tactical initiatives • Targeted business initiatives – Premier re-launch – HSBCDirect (online savings account) – Branch optimization • Balance sheet and capital management – Finance conducting balance sheet optimization study – Leverage ratio constraint unique to US – Current balance sheet has been
Slide 10: In summary
In summary • In order to accomplish the strategic objectives we must… – Maintain a disciplined approach to financial and resource management – Simplify our organizational structures and processes – Leverage Group international connectivity – Focus on delivering results 9
Slide 11: Financial Overview
HSBC USA INC Financial Overview GERARD MATTIA, CHIEF FINANCIAL OFFICER AND 4 December 2007 SENIOR EXECUTIVE VICE PRESIDENT HSBC BANK USA INC.
Slide 12: HSBC USA Inc – key performance metrics
HSBC USA Inc – key performance metrics Third quarter Variance on Year-to-date Variance on Actual Prior yr Prior yr % Actual Prior yr Prior yr % 138 342 (204) (59.6) Profit Before Tax (IAS) 972 1,221 (249) (20.4) 99 231 (132) (57.1) Net Income (IAS Profit After Tax) 668 811 (143) (17.6) 30.4% 36.3% (
Slide 13: HSBC USA Inc – income statement
HSBC USA Inc – income statement IFRS, US$ millions Third quarter Variance on Year-to-date Variance on Actual Prior yr Prior yr % Actual Prior yr Prior yr % 888 790 98 12.4 Net interest income 2,489 2,277 212 9.3 387 451 (64) (14.2) Other revenues 1,543 1,550 (7) (0.5) 1,275 1,241 34 2.7 Total revenu
Slide 14: HSBC USA Inc – profit before tax by customer group
HSBC USA Inc – profit before tax by customer group IFRS, US$ millions Third quarter Variance on Year-to-date Variance on Actual Prior yr Prior yr % Actual Prior yr Prior yr % 154 173 (19) (11.0) Personal Financial Services* 448 454 (6) (1.3) 103 116 (13) (11.2) Commercial Banking 310 324 (14) (4.3)
Slide 15: HSBC USA Inc – period end balance sheet
HSBC USA Inc – period end balance sheet 31-Dec-06 US GAAP, US$ billions Prior 31-Dec-06 Actual Current 30-Sep-07 Actual Inc/(Dec) % Cash and due from banks 3.4 2.6 (0.8) (23.0) Interest bearing deposits with banks 1.9 8.1 6.2 326.3 Fed funds 13.8 11.0 (2.8) (20.3) Trading assets 23.6 31.6 8.0 33.9 S
Slide 16: Corporate, Investment Banking and Markets
HSBC USA INC Corporate, Investment Banking and Markets PAUL LAWRENCE, PRESIDENT AND CEO 4 December 2007 HSBC USA INC JOSE-LUIS GUERRERO, CO-HEAD OF GLOBAL MARKETS NORTH AMERICA
Slide 17: CIBM – global strategic objective
CIBM – global strategic objective • To be the leading emerging markets-led financing-focused wholesale bank by leveraging HSBC Group’s: – Unique heritage and footprint in the emerging markets globally, coupled with major product hubs – Presence in 83 countries and territories* – Scale with access to
Slide 18: CIBM US – local presence/global reach
CIBM US – local presence/global reach • Market our US capabilities to non-US Clients and our international capabilities to US Clients across all products London New York Paris Hong Kong Mature economies Fast-growing economies 17
Slide 19: CIBM US – 2007 business initiatives
CIBM US – 2007 business initiatives • Build a ‘fit for purpose’ platform to meet the international cross-marketing objectives – Grow: Emerging Markets, Structured Derivatives, Payments & Cash Management – Maintain: Capital Markets, Equities, FX, Metals – Reposition to meet Group needs: Credit, Gover
Slide 20: Resultant CIBM business model
Resultant CIBM business model Create a ‘fit for purpose’ platform to: • Service core CIBM clients and to support Group connectivity • Focus on cross-border activities and distribution of international products to US clients and US products to international clients • Focused use of balance sheet for
Slide 21: US Clients – a significant contributor to global revenues
US Clients – a significant contributor to global revenues • US is the second leading contributor to global revenues by client domicile • US clients remain a critical component to the successful implementation of our global strategy • We continue to join up our international capabilities: – US produc
Slide 22: Emerging markets led Global Markets structure and strategy
Emerging markets led Global Markets structure and strategy • Management structure of a joined up Head of CIBM Head of CIBM CEOs North America LatAm LatAm emerging markets has been implemented in 2007 • Co-Heads of Global Markets Americas are responsible for delivering Co-Heads GM Americas Emerging M
Slide 23: Financing-focused Leveraged and acquisition finance
Financing-focused Leveraged and acquisition finance • Key component of CIBM strategy and central to CIBM client proposition • Hub for integrating CIBM businesses into a single client service offering • Strongly positions HSBC as a partner of choice for acquisition financing, M&A advisory and associa
Slide 24: CIBM US – progress to date
CIBM US – progress to date • Business executed and pipeline reflective of emerging markets-led and financing-focused strategy • Emerging markets success highlighted by leading benchmark transactions • Infrastructure and platform right-sized and aligned to strategy • Successfully delivering multi-pro
Slide 25: Personal Financial Services
HSBC USA INC Personal Financial Services KEVIN NEWMAN, HEAD OF PFS NORTH AMERICA 4 December 2007 GROUP GENERAL MANAGER AND SENIOR EVP HSBC USA INC
Slide 26: PFS – building a growth business in a mature market
PFS – building a growth business in a mature market A multi-channel approach to balance sheet growth and value creation leveraging Group to reduce costs and grow revenue • Continue strong customer and deposit growth from Online Savings and Branch Expansion Grow • Focus on Premier and SME improving c
Slide 27: Snapshot 3Q2007
Snapshot 3Q2007 Business units • 463 branches Core PFS • US$39 billion deposits • 4.2 million customers • Delivered through the branch network Core SME • US$13 billion deposits • 159,000 customers • HMUS legal entity, but integral part of PFS Investments • US$17 billion AUM and insurance • 220 finan
Slide 28: Client Propositions
Clear client propositions based on our ‘right to win’ Fully leveraging the HSBC global footprint, platforms and brand • Internationally oriented mass affluent/cosmocrat • Global solutions • Globally connected platforms • Integrated ‘independent’ wealth management Client Propositions • Internationall
Slide 29: Tailored approach to serving our four markets
Tailored approach to serving our four markets Premium and Expansion and Traditional Direct business niche HSBC branch network MSA Total Population (#): <62,333 62,333 101,544 147,741 501,861 501,861+ Source: SNL Financial and HSBC 28
Slide 30: Tailored approach to serving our four markets
Tailored approach to serving our four markets Premium and Expansion and Traditional Direct business niche • ‘Upstate’ • 204 branches • US$13 billion deposits • Leading market share Rest of HSBC branch network MSA Total Population (#): <62,333 62,333 101,544 147,741 501,861 501,861+ Source: SNL Finan
Slide 31: Tailored approach to serving our four markets
Tailored approach to serving our four markets Premium and Expansion and Traditional Direct business niche • ‘Metro NY’ • 185 branches • US$26 billion deposits • Successful Premier and SME proposition Rest of HSBC branch network MSA Total Population (#): <62,333 62,333 101,544 147,741 501,861 Source:
Slide 32: Tailored approach to serving our four markets
Tailored approach to serving our four markets Premium and Expansion and Traditional Direct business niche • NJ CT CA FL DC • 68 new branches • US$3 billion deposits • Focus on Asians, NRI and Cosmocrats Rest of HSBC branch network MSA Total Population (#): <62,333 62,333 101,544 147,741 501,861 Sour
Slide 33: Tailored approach to serving our four markets
Tailored approach to serving our four markets Premium and Expansion and Traditional Direct business niche • No demographic boundaries • 650,000 customers • US$12 billion deposits • 90% new money • 70% out of footprint • Complementary products (OPA and CDs) launched HSBC branch network • Effective an
Slide 34: Strategic initiatives
Strategic initiatives • Customer development • Branch network optimization – Fully integrated Customer Relationship – Continued investment in Management (RM) engine business intelligence – New customer on-boarding efforts – Drive savings through branch right-sizing • People – High-performance cultur
Slide 35: To deliver unrivalled global offer for affluent international people
To deliver unrivalled global offer for affluent international people • Leveraging our global presence across 35 countries and territories with a network of over 250 international flagships • Aiming to attract four million HSBC Premier customers globally by 2011 – Strong growth in the US to date • Bu
Slide 36: Commercial Banking
HSBC USA INC Commercial Banking CHRIS DAVIES, HEAD OF CMB NORTH AMERICA AND 4 December 2007 SENIOR EXECUTIVE VICE PRESIDENT HSBC USA INC
Slide 37: CMB financial performance – North America
CMB financial performance – North America • Consistent revenue and profit growth via organic growth and network expansion • Expansion strategy to result in coverage in 16 of the top 25 business centers in the USA by the end of 2007 • Focus on further development of sector specialisms in Canada and U
Slide 38: CMB in North America – United States
CMB in North America – United States • Diversification from core geographies to major financial centers nationwide via organic office expansion • 2007: MME coverage provided by dedicated offices in 16 of the top 25 business centers ranked by CMB prospects (Source: Dun & Bradstreet), 2004: MME covera
Slide 39: CMB in North America – Canada
CMB in North America – Canada • Canada’s seventh-largest bank and leading foreign bank, with a well- established nationwide franchise made up of 127 branches • Key markets include British Columbia, Alberta and the Greater Toronto Area Quebec British Columbia Manitoba Newfoundland Alberta and Labrado
Slide 40: CMB in North America – Bermuda
CMB in North America – Bermuda • Bermuda’s largest bank with a well-established position in Commercial/Corporate Banking • Key market sectors are Captive Insurance, General Insurance, CRE Saint Catherine and SMEs Point Saint George Saint Georges Island Saint Paget Island Georges Harbour Coney Island
Slide 41: CMB strategic focus – North America
CMB strategic focus – North America • Strategic focus – leading international business • International banking centers – USA established 2005, Canada in 2007 Region • Organic investment in the award-winning Payments and Cash Management platform • Leveraging the CMB franchise to deliver CIBM products
Slide 42: CMB strategic focus – North America
CMB strategic focus – North America • Strategic focus – to be the best small business bank Re-launch SME strategy • Leverage expanded geographic ‘footprint’ USA • Up-skill RMs to position HSBC as a premium service provider for the SME market • In late 2008, offer Business Direct banking SME strategy
Slide 43: CMB in North America In summary
CMB in North America In summary • To be the leading international business bank • To be the best bank for small businesses in target markets • Grow our cross-border referral system • Leverage strengths in payments and cash management, trade finance and links to CIBM 42