Hsbc Holdings Plc · LSE:HSBA
Hsbc — Investor Presentation (November 2016)
26 slides from Hsbc's investor presentation, November 2016
Slide 1: HSBC Mexico
HSBC Mexico Nuno A Matos CEO HSBC México November 2016
Slide 2: Forward-looking statements
HSBC Mexico Forward-looking statements This presentation and subsequent discussion may contain projections, estimates, forecasts, targets, opinions, prospects, results, returns and forward-looking statements with respect to the financial condition, results of operations, capital position and busines
Slide 3: Value of the network
HSBC Value of the network Reduce Group RWAs by c. $290bn and re-deploy towards higher performing businesses; return GB&M to 1 Group target profitability 2 Optimise global network 3 Rebuild NAFTA profitability 4 Set up UK Ring-Fenced Bank 5 Realise $4.5-5.0bn cost savings, deliver an exit rate in 201
Slide 4: Group: Our highlights
HSBC Group Our highlights 3rd Quarter 2016 ‒ Reported PBT of $0.8bn includes the impact of the disposal of our operations in Brazil, changes in fair value of our own debt and costs-to-achieve 3Q16 ‒ Adjusted PBT of $5.6bn up $0.4bn or 7%; Financial ‒ Revenue of $12.8bn up $0.3bn or 2%: Client-facing
Slide 5: 1. Mexico's economic outlook
1. Mexico’s economic outlook
Slide 6: Macroeconomic highlights – Key fundamentals
Mexico’s economic outlook Macroeconomic highlights – Key fundamentals GDP growth (% y-o-y) Central Bank policy rate (%) 4.0 4.75 5.0 4.0 4.5 4.5 3.5 3.25 2.5 3.0 2.1 1.9 2.3 1.4 2011 2012 2013 2014 2015 2016F 2017F 2011 2012 2013 2014 2015 2016F 2017F Inflation % (end of period) Foreign Exchange 4.0
Slide 7: Macroeconomic highlights – Financial deepness and trade openness
Mexico’s economic outlook Macroeconomic highlights – Financial deepness and trade openness GDP per capita (USD ‘000)1&4 Domestic credit to private sector (as % of GDP)2 30.6 31.0 32.7 10.0 10.1 10.6 10.8 27.5 9.4 9.5 25.7 8.7 2011 2012 2013 2014 2015 2016F 2017F 2011 2012 2013 2014 2015 Total Export
Slide 8: Macroeconomic highlights - Public sector
Mexico’s economic outlook Macroeconomic highlights - Public sector Budget Deficit (% GDP) Gross public sector debt (% GDP) 50.5 50.2 3.5 45.3 3.1 38.0 40.7 2.6 3.0 33.6 35.3 2.4 2.3 2.5 2011 2012 2013 2014 2015 2016F 2017F 2011 2012 2013 2014 2015 2016F 2017F Oil revenues (% of total gov revenues) 3
Slide 9: Mexico connected to key regions
Mexico’s trade Mexico connected to Key regions Mexico in key trade corridors1 2015 value of trade (exports and imports), USDbn Trade with Europe Germany 18 Spain 8 Other 41 Europe 67 Trade with NAFTA US 496 Trade with Asia Canada 21 China 75 Japan 20 NAFTA 517 South Korea 18 Other 39 Asia 152 Trade
Slide 10: NAFTA Opportunities
Mexico’s trade NAFTA Opportunities • HSBC is the leading international bank and US-Mexico and US-Canada are amongst top trade corridors in the World and will be 1st and 2nd largest commodity corridors by 2020 HSBC Advantages • HSBC has significant presence in all three countries • International Trad
Slide 11: 2. HSBC in Mexico
2. HSBC in Mexico HSBC €X>
Slide 12: The Mexican operation is strategically important for Group
HSBC in Mexico The Mexican operation has been considered strategically important for Group with significant potential to improve Ownership chart HSBC Mexico performance1 Revenues USDm % of Group +16% HSBC Holdings plc 1,473 3.8% 1,271 3.2% 9M15 9M16 9M15 9M16 HSBC Latin America PBT Holdings (UK) Lim
Slide 13: Key executives bios
HSBC in Mexico Key executives bios Nuno A. Matos Joined HSBC in March 2015. Appointed CEO of HSBC Mexico in December 2015. Experience: Worked for Santander since 1994 in a variety of retail banking, investment banking and CEO functional leadership roles across Europe, the US and Latin America. Also
Slide 14: HSBC Mexico is a key player in the Mexican Financial System
HSBC in Mexico HSBC Mexico is a key player in the Mexican Financial System with room to grow HSBC Mexico position Key businesses Contribution to HSBC Mexico5 • Competitive top-5 universal bank with scale1 • Leading trade and cash management bank2 RBWM CMB GB&M • Important retail player with high cus
Slide 15: Our Strategy
HSBC in Mexico Our Strategy + Clients + Share of Wallet + Profitability Manage Financial Crime Risk RBWM CMB GB&M Grow Individual customer base Grow and diversify customer Improve customer profitability base Relaunch Retail Business Focus on transaction banking Banking Focus on transaction banking (
Slide 16: HSBC Mexico operates with scale in a connected economy
HSBC in Mexico HSBC Mexico operates with scale in a connected economy, which in contrast to the Brazil operation pre-sale Exports as Trade1, 2015 % of GDP, 2015 Brazil, Assets2 Mexico, Assets3 USDbn USDbn USDbn China 2,282 21% Banco do #1 499 #1 BBVA 98 US 1,504 8% Brasil Germany 1,331 40% #2 Itau U
Slide 17: 3. Financial performance
3. Financial performance HSBC €X>
Slide 18: Financial performance 2015-2016
HSBC Mexico Financial performance 2015-2016 Revenues1 Loan impairment charges MXNm MXNm -8.8% +14.3% 27,287 6,306 5,750 23,866 9M15 9M16 9M15 9M16 Expenses Profit before taxes MXNm MXNm +177% +9.0% 3,951 17,630 16,169 1,425 9M15 9M16 9M15 9M16 17 Source: HSBC Mexico 3Q16 press release. 1 Revenues re
Slide 19: Financial performance 2015-2016 – excluding non-recurrent items
HSBC Mexico Financial performance 2015-20162 – excluding non-recurrent items Revenues1 Loan impairment charges MXNm MXNm +10.9% +12.8% 5,183 5,750 23,866 26,935 9M15 9M16 9M15 9M16 Expenses Profit before taxes MXNm MXNm +51.5% +7.4% 3,859 17,370 16,169 2,548 9M15 9M16 9M15 9M16 Source: HSBC Mexico 3
Slide 20: Credit portfolio increasing steadily, deposits managed to effective A/D ratio
HSBC Mexico Credit portfolio increasing steadily, whilst deposits being managed with a view to reach an effective A/D ratio Loans and advances, net MXN bn +19.5% 253.3 257.8 242.0 232.1 215.7 Sep 15 Dec 15 Mar 16 Jun 16 Sep 16 Demand and Time Deposits1 MXN bn +7.6% 265.3 274.0 275.2 285.4 258.2 Sep
Slide 21: Credit loan growth as of August 2016
HSBC vs Market Credit loan growth as of August 2016 Total gross loans Total gross loans (excl. Gov) MXNbn MXNbn +13% +15% 4,092 3,546 3,604 3,074 +14% +16% 230 261 198 230 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Market HSBC Market HSBC Mexico Mexico Consumer loans (mortgage not inclu
Slide 22: NPL ratio as of August 2016
HSBC vs Market NPL ratio as of August 2016 Total NPL ratio Commercial NPL ratio (%) (%) 5.5 6.8 3.9 4.6 2.9 2.4 2.2 1.7 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Market HSBC Mexico Market HSBC Mexico Consumer NPL ratio Mortgage NPL ratio (%) (%) 4.6 3.4 4.2 3.0 3.0 3.3 1.9 1.5 Aug 15 A
Slide 23: Credit quality as of August 2016
HSBC vs Market Credit quality as of August 2016 Loss reserves / Loans Coverage ratio (Reserves / NPL) (%) (%) 5.6 5.2 133.0 148.4 132.1 3.9 3.6 100.9 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Market HSBC Market HSBC Mexico Mexico 22 Source: CNBV, figures under local Gaap
Slide 24: Market data as of August 2016
HSBC vs Market Market data as of August 2016 Lending rates (NIM adjusted by LICs) Credit Costs (LICs/Loans) (%) (%) 5.6 5.2 5.8 4.4 3.5 2.7 2.9 2.6 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Aug 15 Aug 16 Market HSBC Market HSBC Mexico Mexico 23 Source: CNBV, figures under local Gaap
Slide 25: 4. Final remarks
4. Final remarks HSBC €X>
Slide 26: Final remarks
HSBC Mexico Final remarks • Turnaround financial performance • Increase new to bank customer base in RBWM through CMB/GB payroll collaboration • Increase market share of wallet of existing customers across all businesses, and become a player commensurate with our retail scale • Grow CMB/GB focusing
HSBC Holdings — Investor Presentation (November 2016) on 6ix