HSBC Holdings PLC · LSE:HSBA
HSBC — UBS Conference 2009
15 slides from HSBC's conference presentation, May 12, 2009
Slide 1: HSBC: strong despite the environment
HSBC HOLDINGS PLC HSBC: strong despite the environment DOUGLAS FLINT 12 MAY 2009 GROUP FINANCE DIRECTOR
Slide 2: Forward looking statements
Forward looking statements This presentation and subsequent discussion may contain certain forward-looking statements with respect to the financial condition, results of operations and business of the Group. These forward-looking statements represent the Group’s expectations or beliefs concerning fu
Slide 3: Financial crisis has hit real economy
Financial crisis has hit real economy • Co-ordinated policy measures by governments • Extreme levels of stress in financial and credit markets have been reduced But • Financial system remains under strain • Dislocation in financial system spread to wider economy • Sharp contraction in demand and wor
Slide 4: Future remains uncertain
Future remains uncertain • Economic activity remains unusually depressed in spite of low interest rates • Unemployment increasing But • US consumer spending held up well • Asia proven resilient, with China and India continuing to grow robustly • Still see growth in key emerging markets in 2010 4
Slide 5: The big issues for 2009
The big issues for 2009 • How bad will it get? • When can we expect to see recovery? • How will markets behave? 5
Slide 6: What will the financial industry look like after recovery?
What will the financial industry look like after recovery? • Industry entering a period of profound change • Supervision and regulation will be enhanced • Bank capitalisation and increased scrutiny of banks’ capital • Return to core products, with appropriate pricing of risk • Shift in the provision
Slide 7: HSBC: Strength, diversity and resilience
HSBC: Strength, diversity and resilience Strength from diversified business model and financial position Strategy positions Group for long-term growth and attractive returns Rights issue – strengthen competitive positioning Managing capital allocation and balance sheet risk 7
Slide 8: Key highlights from the Interim Management Statement
Key highlights from the Interim Management Statement Underlying • Excluding fair value gains on our own debt, underlying pre-tax profits were lower than pre-tax profit 1Q 2008, but significantly higher than 4Q 2008. • Generated capital ahead of the run rate achieved in 2H 2008 and more than covered
Slide 9: Strength from diversified business model and financial position
Strength from diversified business model and financial position Profitable in all Customer Groups, except Personal Financial Services and in all Regions, except North America Global • Delivered record quarterly results Banking and • Strong in foreign exchange and interest rate trading Markets • Clie
Slide 10: Strength from diversified business model and financial position
Strength from diversified business model and financial position Funding, liquidity and capital: maintaining our signature financial strength • Deposit rich balance sheet: conservative advances to deposits ratio of 82 per cent • Capital generation in the quarter was ahead of the run rate achieved in
Slide 11: Loan impairment charges, other credit risk provisions and AFS reserve
Loan impairment charges, other credit risk provisions and AFS reserve • Loan impairment charges and other credit risk provisions rose in 1Q 2009 in all customer groups and regions • Over half the increase was in Personal Financial Services, driven by continuing weakness in the US • However, in US th
Slide 12: HSBC Finance Corporation run-off portfolio
HSBC Finance Corporation Run-off portfolio: below US$100bn Customer loans1, US $bn 121.6 120.3 117.6 Run-off portfolio 114.2 109.9 18.5 18.5 18.1 17.5 16.8 104.3 100.4 95.9 • The run-off portfolio decreased 16.2 15.7 48.8 15.0 $4.5 billion or 4 percent from 49.9 50.2 49.9 49.0 47.3 46.2 45.1 Decembe
Slide 13: Strategy is intact and positions Group well for long-term growth
Strategy is intact and positions Group well for long-term growth and attractive returns Concentrating on core emerging markets and faster growing businesses Benefiting from combination of world’s leading emerging market bank with extensive international network Focus on organic but positioned for in
Slide 14: Strategy is intact: target ranges
Strategy is intact and positions Group well for long-term growth and attractive returns Target range Return on total shareholders’ equity 15 – 19% through the cycle Cost efficiency ratio 48 – 52% Tier 1 capital 7.5 – 10.0% Total shareholder return Above peer group average 14
Slide 15: Strength, diversity and resilience
Strength, diversity and resilience 15