HSBC Holdings PLC · LSE:HSBA
HSBC — Investor Day (June 2013)
28 slides from HSBC's investor day presentation, Jun 12, 2013
Slide 1: HSBC in Europe – Strategy update
12 June 2013 HSBC in Europe – Strategy update Brian Robertson Chief Executive Officer, HSBC Bank plc
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: Agenda
Agenda HSBC in Europe – Strategy update A Distinctive position in the new banking environment B Proven track record in delivering change – First phase C Clear plan for growth – Next phase 3
Slide 4: Europe – Strategy update
Europe – Strategy update A Distinctive position in the new banking environment I Long term trends remain valid II HSBC’s distinctive position B Proven track record in delivering change – First phase C Clear plan for growth – Next phase 4
Slide 5: The backdrop is still challenging in Europe
I. Long term trends remain valid The backdrop is still challenging in Europe Lack of visibility in the short term GDP growth in key markets1 Real GDP year-on-year change (%) Weak growth prospects in the short-term 10% Small and gradual rise in consumer 8% Subdued macro spending expected 6% 4% en
Slide 6: Despite a rebalancing of the world economy, growth in Europe will remain steady
I. Long term trends remain valid Despite a rebalancing of the world economy, growth in Europe will remain steady in the long run GDP of top 30 economies USDtrn Largest Share of 2050 106 countries GDP1 (%) Mainland China 20 India 7 57 Brazil 2 Mexico 2 Our priority Turkey 2 growth markets2 Other 14 e
Slide 7: Europe will continue to contribute significantly to world trade growth
I. Long term trends remain valid Europe will continue to contribute significantly to world trade growth World trade growth1 6 European countries in the Top 15 in 20202 Corridor Merchandise export Imports and exports, USDbn 2010-12, CAGR, % Share of CAGR world trade Mature markets to Germany 2.8 1.8
Slide 8: Distinctive position in the new banking environment
II. HSBC’s distinctive position Distinctive position in the new banking environment What matters going HSBC competitive Key trends forward advantages HSBC in Europe Economic Organic investment Meaningful presence in An extensive network development and opportunities in the most many of the mos
Slide 9: Europe is a key region for HSBC
II. HSBC’s distinctive position Europe is a key region for HSBC A robust contribution to Group profitability … … and to the funding base Europe’s contribution to Group and GB’s Customer accounts, 31 December 2012, USDbn reported PBT, 1Q 2013, % Group PBT 21% Europe 555 41% Asia 530 40% Total RBWM 26
Slide 10: Europe – Strategy update
Europe – Strategy update A Distinctive position in the new banking environment B Proven track record in delivering change – First phase I Capital deployment II Organisation and cost efficiency III Growth IV Financial performance C Clear plan for growth – Next phase 10
Slide 11: At the beginning of 2011 we defined a new vision for HSBC
Proven track record in delivering change – First phase At the beginning of 2011 we defined a new vision for HSBC Throughout our history we have been where the growth is, connecting customers to opportunities. We enable Purpose businesses to thrive and economies to prosper, helping Reason why we exis
Slide 12: Material progress over the last two years
Proven track record in delivering change – First phase Material progress over the last two years May 2011 report card Progress to date in Europe Six Filters driving disposals and closures 17 disposals/exits announced since 2011 of non-strategic and/or underperforming Progress in running down o
Slide 13: Reduced fragmentation and clear focus in the European portfolio
I. Capital Deployment Reduced fragmentation and clear focus in the European portfolio UK: Disposal of Slovakia: Full exit Montagu Private Equity stake, Motor Insurance business, Poland & Russia: Exit Ireland: HSBC Private Bank Property Vision, from RBWM operations – (UK) Ltd. branch closed, HSBC Shi
Slide 14: Established a simplified, more focused and easier to manage organisation
II. Organisation and cost efficiency Established a simplified, more focused and easier to manage organisation Progress Developing global strategies Created four Defining and implementing consistent business and operating model Global Focus on clear portfolio of activities Businesses Oversigh
Slide 15: Simplifying Europe
II. Organisation and cost efficiency Simplifying Europe Transformation Sustainable saves Employees Reshaped portfolio USDm Year-end FTE, thousands Simplified organisation Established Four Programmes 1. Re-engineer operational processes -5.6k 2. Re-engineer Global Functions 3. Implement consist
Slide 16: Gained market share in European priority markets
III. Growth Gained market share in European priority markets 2010-2012 change in market share Market share of 12% on new mortgages, up from 9% in 20101 UK 17% market share of the UK trade finance market, up from 13% in 20112 RBWM growing faster than market over 2010-12: total deposits (+10% pa
Slide 17: Significant progress growing the business
III. Growth Significant progress growing the business Material progress in Europe… …leading to growth Volumes in RBWM, USDbn and year-on-year growth Transformed the wealth management business whilst continuing to invest Loans and Customer ‒ Services redesigned in accordance with the advances accou
Slide 18: Europe performance – 1Q 2013 results
IV. Financial performance Europe performance – 1Q 2013 results Financial results % Better / Worse USDm 1Q 2012 1Q 2013 1Q13 vs 1Q12 Revenue 3,885 5,968 53.6% Loan Impairment Charges (347) (190) 45.2% Operating Expenses (4,534) (3,984) 12.1% Reported PBT (997) 1,795 - Underlying PBT1 949 1,949 105.4%
Slide 19: Strong performance in GBM, RBWM and CMB
IV. Financial performance Europe performance – 1Q 2013 results Strong performance in GBM, RBWM and CMB Reported PBT by Global Business USDm, and year-on-year % growth RBWM: good growth in secured lending, lower LICs and lower customer redress provisions RBWM RBWM 400 +641% CMB: Higher lending an
Slide 20: Europe – Strategy update
Europe – Strategy update A Distinctive position in the new banking environment B Proven track record in delivering change – First phase C Clear plan for growth – Next phase I Priorities II Targets for Europe 20
Slide 21: Europe's strategic direction fully aligned to Group's priorities
I. Priorities Europe’s strategic direction fully aligned to Group’s priorities Actions and priorities By 2016 Continue to recycle RWAs from Continue to grow RWAs in line with our organic low into high performing investment criteria in our priority markets opportunities within the Group’s Legac
Slide 22: CMB growth priorities in Europe
I. Priorities – Grow business CMB growth priorities in Europe The Leading International Trade and Business Bank Growth priorities to 2016 2016 Global business targets Drive revenue growth through international network Accelerate Corporate segment growth Financial RoRWA3, % 2.2-2.5 Continue to in
Slide 23: GBM growth priorities in Europe
I. Priorities – Grow business GBM growth priorities in Europe Connecting clients to global growth opportunities Growth priorities to 2016 2016 Global business targets Well-positioned in products that will benefit from global trends Debt Capital Markets – Corporates in Europe shifting financing Fin
Slide 24: RBWM growth priorities in Europe
I. Priorities – Grow business RBWM growth priorities in Europe Securing customers’ future prosperity and realising their ambitions Growth priorities to 2016 2016 Global business targets Growth in priority markets RoRWA1, % 3.8-4.3 Grow number of customers in target segments RoRWA1, 5.0-5.5 Deepen
Slide 25: GPB growth priorities in Europe
I. Priorities – Grow business GPB growth priorities in Europe Building on our commercial banking heritage, be the leading private bank for business owners Growth priorities to 2016 2016 Global business targets Reposition the business Focus on home and growth priority markets, particularly onshore
Slide 26: Global Standards define governance and programmes
I. Priorities – Implement Global Standards Global Standards define governance and programmes Financial System Provides governance, oversight and policy advice to simplify business Vulnerabilities activities and enhance risk management and control Committee1 Sets the strategic direction and prior
Slide 27: Europe – Strategy update
Europe – Strategy update A Distinctive position in the new banking environment B Proven track record in delivering change – First phase C Clear plan for growth – Next phase I Priorities II Targets for Europe 27
Slide 28: Next phase 2014-16 – Targets for Europe
II. Targets for Europe Next phase 2014-16 – Targets for Europe Strategy remains unchanged Grow both business and dividends Implement Global Standards Streamline processes and procedures Targets RoRWA 1.4-1.7%1 Positive jaws CER mid-50s Additional sustainable saves, significantly contri