Hsbc Holdings Plc · LSE:HSBA
Hsbc — HSBC Bank — Investor Presentation (March 2012)
27 slides from Hsbc's investor presentation, Mar 26, 2012
Slide 1: Europe 2011 – A year of strategic progress
Europe 2011 – A year of strategic progress Brian Robertson Chief Executive, HSBC Bank Plc 26 March 2012
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 Economic overview and HSBC position Section 1 2011 financial performance Section 2 Progress against strategic direction Section 3 Outlook and conclusions Section 4 3
Slide 4: Key messages
Key messages HSBC is well positioned to capture medium-term opportunities in Europe 2011 Europe results impacted by lower GB&M revenues partly offset by strong profit growth in CMB and resilient profits in RBWM Strong progress in strategy implementation Significant cost initiatives in progress acros
Slide 5: Economic overview and HSBC position
Economic overview and HSBC position
Slide 6: Short-term macro-economic outlook uncertain
Short-term macro-economic outlook uncertain Insert GPS number here In the UK, 2.1% growth in 2011 GDP growth Inflation however with inflation of 5.2% in September 2011 before 10% 12% moderating to 3.6% in December 2011 8% 10% 6% In the Eurozone, 1.5% growth 8% 4% in 2011, however 0.2% 6% contraction
Slide 7: Changing regulation
Changing regulation Complex series of regulatory changes at global, regional and national levels will transform how the sector operates Most important developments for HSBC Bank plc: – Basel 3 capital, liquidity and funding requirements – UK’s Independent Commission on Banking (ICB) Other curr
Slide 8: Key longer-trends remain attractive: Europe is the global trade hub
Key longer-trends remain attractive International connectivity - Europe is the global hub for trade flows Major trade flows Top trade countries 20101 Europe countries in the Top 15 global Imports and Exports, USDtrn2 CAGR 2010-2020 % Intra-regional trade: Europe Germany 2.9 2.7 7 Intra-regional trad
Slide 9: Key longer-trends remain attractive: wealth potential
Key longer-trends remain attractive Wealth potential driven by ageing population and growing number of mass affluent individuals Ageing population Wealth European population aged 65 and over1, % European mass affluent individuals2, millions 16 8.8 UK +8 4.4 24 11.0 17 6.6 France +9 2.6 26 7.5 8 0.9
Slide 10: HSBC competitive advantages (Europe)
HSBC competitive advantages (Europe) Advances to Deposits ratio at 88.0% (DEC11) Strong balance sheet Tier 1 ratio at 10.0%, total capital ratio at 14.4%1 (DEC11) Resilient and Reported 2011 PBT of USD4.7bn5 despite challenging environment diversified business 40% growth in CMB profitability
Slide 11: 2011 financial performance – Europe
2011 financial performance – Europe
Slide 12: Europe financial overview
Europe financial overview Insert GPS number here 2011 pre-tax profit of Reported, USDm USD4.7bn, 9% higher than in 2010, 2011 vs 2009 2010 2011 including: 2010 - Favourable fair value Income 23,544 22,750 24,246 +7% movements2 of USD2.9bn in 2011, compared with Loan impairment1 (5,568) (3,020) (2,51
Slide 13: Europe PBT per global business and geography
Europe PBT per global business and geography PBT impacted by lower revenues in GB&M partly offset by 40% growth in CMB Europe PBT per global business Europe PBT per geography, excluding “Other1” Reported, USDbn Reported, 2011, USDbn 0.3 0.2 1.3 0.2 0.9 1.3 0.2 4.7 1.2 4.3 1.0 0.1 4.0 0.6 1.3 4.5 0.3
Slide 14: Europe revenues
Europe revenues Growth in CMB, RBWM and GPB offset by revenue reduction in GB&M Europe revenues per global business Reported, USDbn 2011 growth GB&M revenues in Credit and Rates impacted by the 24.2 +7% 22.8 effect of turmoil in Eurozone sovereign debt markets 3.4 n/a In CMB, income growth drive
Slide 15: Europe loan impairment charges
Europe loan impairment charges Significant reduction in impairments driven by RBWM Europe LICs1 per global business Reported, USDbn 2011 growth In RBWM, lower delinquency rates across both the secured and unsecured lending portfolios from a 3.0 range of initiatives including a focus on monitoring
Slide 16: Expenses
Expenses Growth driven by significant notable items, CHF strengthening and compliance costs, partly offset by sustainable saves Europe expenses Reported, USDm Excluding notable items, operating expenses growth c.1,000 driven by: 17,069 404 – Higher regulatory and compliance costs c.(300) 570 – Inc
Slide 17: Balance sheet
Balance sheet Growth in CMB and RBWM offset by contraction in GB&M Loans and advances to customers (net) Customer accounts Reported, USDbn1 Reported, 2011, USDbn 2011 growth 2011 growth 492 493 0% 436 434 0% 169 176 +4% 145 150 +4% 97 105 +8% 92 98 +7% 56 28 58 +4% 28 +3% 170 157 -8% 170 154 -9% 201
Slide 18: Exposure to Eurozone
Exposure to Eurozone Insert GPS number here Strong risk management At 31 December 2011, our Exposure to peripheral Eurozone Sovereign and agencies exposure to Group exposure to the PIIGS1 sovereign and agency debt countries1 core Eurozone countries2 was USD4.7bn, USD2.2bn 31 December 2011, USDbn, un
Slide 19: Progress against Group strategy
Progress against Group strategy
Slide 20: Strategic direction and actions overview
Strategic direction and actions overview Be the leading international bank connecting Europe with the rest of the world and capturing Europe’s wealth opportunity 1 RBWM 2 CMB 3 GB&M 4 GPB Focus on selected Drive international Expand franchise Optimise market markets where we and intra-Group across t
Slide 21: RBWM
RBWM Continue to invest in UK, France and Turkey and rationalise portfolio RBWM key strategic initiatives1 20112 update Focus investments in UK, France and Turkey and grow our wealth management franchise UK: Focus on building long term sustainable Continuous development in Wealth Management –
Slide 22: CMB
CMB Build upon proven Leading International Business strategy CMB key strategic initiatives1 20112 update Focus investments to capture regional and global UK: FDI3 and trade flows (e.g. UK, France, Germany, Further progress in becoming the leading International Bank Turkey) – Launch of a full se
Slide 23: GB&M
GB&M Global connectivity backed by core product capabilities GB&M key strategic initiatives1 2011 update Optimise market coverage: Build on London and Revenues markedly lower in 2011 due to Paris hubs, develop FIG and Multinational – Significantly lower trading revenues in Credit and Rates as tu
Slide 24: GPB
GPB Optimise market coverage and create synergies across Europe GPB key strategic initiatives1 2011 update Leverage intragroup strengths and connectivity with growth markets Revenue growth driven by increased client activity as Scale up product offerings by leveraging the we leveraged our glob
Slide 25: Increase operational efficiencies through portfolio rationalisation and cost savings
Increase operational efficiencies through portfolio rationalisation and sustainable cost savings Key strategic initiatives 2011 update Closure of Russia and Poland retail banking Closure of Private Banking operations in Russia Portfolio rationalisation Exit from Georgia Disposal of the motor
Slide 26: Outlook and conclusions
Outlook and conclusions
Slide 27: Outlook and conclusions
Outlook and conclusions Strong progress in implementing our strategy: Consolidating existing strong positions (incl. UK, France, Germany) Leveraging connectivity (CMB, GBM, GPB) Driving RBWM in selected markets where we have scale Increasing operational efficiencies through portfolio rationalisati