Hsbc Holdings Plc · LSE:HSBA
Hsbc — HSBC Mexico — Debt Investor Presentation (November 2018)
30 slides from Hsbc's debt investor presentation, November 2018
Slide 1: Investor Presentation HSBC Mexico
Investor Presentation HSBC Mexico November 2018
Slide 2: Important notice and forward-looking statements
Important notice and forward-looking statements This presentation and the information contained herein and the subsequent discussions do not constitute a public offer for the purposes of any applicable law or a recommendation, advice offer or solicitation to buy purchase or sell any security, commod
Slide 3: Agenda
Agenda 1 HSBC Group 2 HSBC in Mexico 3 Mexico financial results 4 Key indicators vs total system 5 Characteristics of the offer 6 Appendix 3
Slide 4: 1. HSBC Group
1. HSBC Group 4
Slide 5: Strategic differentiators enable a strategy focused on growth, improving returns
1. HSBC Group Strategic differentiators enable a strategy focused on growth, improving returns, and enhancing customer and employee experience Strategic differentiators Strategic priorities Financial targets 1 Leading international bank 1 Accelerate growth from our Asian >50% of Group client reven
Slide 6: HSBC is a leading international bank
1. HSBC Group HSBC is a leading international bank Our global footprint Diversified global businesses and regions1 Markets at scale and markets as leading international bank 9M18: by global business, $bn Markets to connect the network Adjusted 16.8 11.2 12.4 1.4 $41.4bn revenue Adjusted 5.7 6.0 5.4
Slide 7: 2. HSBC in Mexico
2. HSBC in Mexico 7
Slide 8: Mexico – a priority market for the Group
2. HSBC in Mexico Mexico – a priority market for the Group In its June 2018 strategy update, HSBC segmented each local market into one of three segments % of adj. Aspiration Characteristics Markets revenue FY17 Top 5 bank, at least 3-5% Hong Kong Malaysia market share UK UAE “HSBC is consi
Slide 9: Mexico – Connected with key regions
2. HSBC in Mexico Mexico – Connected with key regions Mexico in key trade corridors1 2017 value of trade (exports and imports), USDbn Trade with Europe Germany 23 Spain 9 Other 45 Europe 77 Trade under NAFTA US 522 Trade with Asia Canada 21 China 81 Japan 22 NAFTA 543 South Korea 19 Other 45 Asia 16
Slide 10: Strategic opportunity for HSBC in Mexico
2. HSBC in Mexico Strategic opportunity for HSBC in Mexico Significant opportunity to leverage our existing infrastructure HSBC Mexico retail market share as of 30 June 2018 (%)1 Comparison vs % 7.0% 8.1% 8.9% 5.9% 5.2% 9.6% Dec 15 Branches 13.5 Market Share In retail banking, our market share of cu
Slide 11: HSBC in Mexico
2. HSBC in Mexico HSBC in Mexico HSBC in Mexico Our global businesses ♦ Competitive top-5 universal bank with scale1 Retail Banking and Wealth Management ♦ Leading trade and cash management bank2 ♦ Full range of banking products and services high net ♦ Important retail player3 RBWM worth, mass afflu
Slide 12: Our Mexican business is strategically important to Group
2. HSBC in Mexico Our Mexican business is strategically important to Group Ownership chart HSBC Mexico performance1 Adjusted revenue USDbn +7% % of Group HSBC Holdings plc 1.1 4.0% 1.0 3.8% 1H 17 1H 18 1H 17 1H 18 HSBC Latin America Holdings (UK) Limited Reported PBT USDbn 100% % of Group +54% 2.5%
Slide 13: HSBC Mexico's progress is recognised worldwide
2. HSBC in Mexico HSBC Mexico’s progress is recognised worldwide Latin America's best bank transformation 2018: HSBC Mexico Euromoney Awards for Excellence 2018 13
Slide 14: 3. Mexico Financial Results
3. Mexico Financial Results 14
Slide 15: HSBC Mexico – Income statement
3. Mexico Financial Results HSBC Mexico – Income statement Sep 18 YTD PBT 68% higher than Sep 17 YTD Revenue1,2 Loan impairment charges (LICs)2 MXNm MXNm +9% +11% +32% -1% 29,927 6,724 6,665 26,903 24,633 5,078 9M16 9M17 9M18 9M16 9M17 9M18 Operating expenses Profit before tax MXNm MXNm -3% +6% +52%
Slide 16: HSBC Mexico – Loans and asset quality
3. Mexico Financial Results HSBC Mexico – Loans and asset quality Robust credit quality, reflecting HSBC’s conservative approach to risk management Loan Portfolio LICs1 / Loans % MXNbn 3.1 +6% +27% 2.5 2.4 365.0 271 287.7 Sep 16 Sep 17 Sep 18 Sep 16 Sep 17 Sep 18 Non performing loan ratio 2 % LLR3 /
Slide 17: HSBC Mexico – Funding and liquidity
3. Mexico Financial Results HSBC Mexico – Funding and liquidity Strong funding and liquidity position, well above regulatory minimum Deposits Advances / deposits ratio (ADR) % MXNbn +4% +23% 98.2% 371.7 95.4% 290.3 301.8 93.4% Sep 16 Sep 17 Sep 18 Sep 16 Sep 17 Sep 18 Liquidity coverage ratio (LCR)
Slide 18: HSBC Mexico – capital
3. Mexico Financial Results HSBC Mexico – capital Total capital adequacy ratio of 12.7%, 190bps above regulatory requirements Capitalisation % Total capital adequacy ratio 12.3% 12.7% 12.7% At 30 September 2018, the bank’s total capital adequacy ratio was 12.7% and the tier 1 capital ratio was 10.
Slide 19: 4. Key indicators vs total system
4. Key indicators vs total system 19
Slide 20: HSBC Mexico vs Total System
4. Key indicators vs System HSBC Mexico vs Total System HSBC growth Total loans Retail loans MXNbn MXNbn +12% +14% +8% +5% 4,978 340 1,776 95 100 4,462 297 1,643 JUN17 JUN18 JUN17 JUN18 JUN17 JUN18 JUN17 JUN18 Total Banking system HSBC México Total Banking system HSBC México Wholesale loans Wholesal
Slide 21: HSBC Mexico vs Total System
4. Key indicators vs System HSBC Mexico vs Total System Net interest margin % Net interest margin (excluding LICs) % 7.9 7.9 5.7 5.7 6.5 6.5 4.5 3.9 JUN17 JUN18 JUN17 JUN18 JUN17 JUN18 JUN17 JUN18 Total Banking system HSBC México Total Banking system HSBC México Credit cost (Annualised LICs/Loans) %
Slide 22: HSBC Mexico vs Total System
4. Key indicators vs System HSBC Mexico vs Total System Non Performing Loan ratios in retail products better than market Non Performing Loan ratio % Wholesale Non Performing Loan ratio % 2.8 2.7 2.1 2.2 2.3 2.1 1.2 1.3 JUN17 JUN18 JUN17 JUN18 JUN17 JUN18 JUN17 JUN18 Total Banking system HSBC Mexico
Slide 23: 5. Characteristics of the Offer
5. Characteristics of the Offer 23
Slide 24: Long Term Notes
5. Characteristics of the Offer Long Term Notes Issuance of long term notes (Certificados Bursátiles bancarios) up to 10 billion pesos Issuer HSBC México, S.A., Institución de Banca Múltiple, Grupo Financiero HSBC Type of Security Certificados Bursátiles Bancarios de largo plazo (Long Term Notes) Lo
Slide 25: 6. Appendix
6. Appendix 25
Slide 26: Current credit ratings for key entities
6. Appendix Current credit ratings for key entities Long term senior ratings Fitch Moody’s S&P Rating Outlook Rating Outlook Rating Outlook HSBC Holdings plc AA- Stable A2 Stable A Stable HSBC Mexico AAA Stable Aa1 Positive mxAAA Stable 26
Slide 27: Simplified structure chart - principal entities as at 1 October 2018
6. Appendix Simplified structure chart - principal entities1 as at 1 October 2018 Holding company Intermediate holding company HSBC Operating company Holdings plc Associate UK 99% HSBC HSBC The Hongkong HSBC HSBC HSBC Private HSBC HSBC North Bank (China) & Shanghai Bank 95% Bank HSBC UK Banking Mexi
Slide 28: Main launches
6. Appendix Main launches Retail (RBWM1) • HSBC Fusion - 2017 • Samsung Pay – January 2018 • 2Now Credit Card – February 2018 • HSBC Stilo – July 2018 • HSBC Zero – September 2018 Wholesale (CMB2 / Global Banking and Markets ) • GLCM3: HSBC net Mobile: Touch ID y Face ID • GTRF3: New product launch
Slide 29: Turnaround
6. Appendix Turnaround On financial results and strengthening of financial crime risk management capabilities 2017 Performance HSBC Grupo Financiero for the year ending 2017 Figures in MXN bn under local GAAP Competitive universal bank with significant scale. Revenue1 40.2 Leading bank in paymen
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