HSBC Holdings PLC · LSE:HSBA
HSBC — H1 2001 Earnings Presentation
22 slides from HSBC's earnings presentation, 2001
Slide 1: HSBC Holdings plc 2001 Interim Results
HSBC Holdings plc 2001 Interim Results =>@ =>@A
Slide 2: Forward-looking statements
Forward-looking Forward-looking statements statements This This presentation presentation and and subsequent subsequent discussion discussion may may contain contain certain certain forward-looking forward-looking statements statements with with respect respect toto the the financial financial condi
Slide 3: 2001 interim results highlights
2001 interim results highlights • Profit attributable to shareholders surpasses $4 billion* for the first time • Economic profit more than doubled from second half of 2000 • Republic/CCF integration essentially completed - synergies on track • Return on invested capital 16% • Margin improvement in U
Slide 4: 2001 interim results - overview
2001 interim results - overview Cash Cash basis basis Reported Reported US$m US$m Operating Operating profit profit before before provisions provisions 5,652 é 5,652 é 1% 1% 5,251 ê 5,251 ê 4% 4% Pre-tax Pre-tax profit profit 5,840 é 5,840 é 9% 9% 5,435 é 5,435 é 4% 4% Attributable Attributable prof
Slide 5: Business conditions in H1 2001
Business conditions in H1 2001 • Lower growth in most of the world’s economies • Volatile and falling equity markets • Declining confidence in some emerging market economies • Economic activity slower 2001 Interim Results 5 =>? =>
Slide 6: HSBC's response to business conditions
HSBC’s response to business conditions • Not to accept increased risk Ø Position accordingly • Maintain strong liquidity & capital • Invest internally and externally 2001 Interim Results 6 =>? =>
Slide 7: HSBC's investment profile
HSBC’s investment profile • Building businesses of the future Ø Ø personal personal internet internet banking banking ▲▲ 2.2m 2.2m customers customers Ø Ø upgrading upgrading hsbc.com hsbc.com Ø Ø Premier Premier • Acquisitions/launches Ø Ø additions additions in in France, France, Greece, Greece, T
Slide 8: Cash basis profit before tax
2001 Interim Results Cash Cash basis basis profit profit before before tax tax (with (with H1 H1 2000 2000 at at constant constant exchange exchange rates) rates) H1 H1 2001 2001 H1 H1 2000 2000 Change Change Europe Europe 2,377 2,377 1,910 1,910 24% 24% Hong Hong Kong Kong 2,055 2,055 1,903 1,903 8
Slide 9: Cash basis profit before tax and total assets by region
Cash basis profit before tax Total assets (with H1 2000 at constant exchange rates) (June 2000 at constant exchange rates) North North Latin Latin America North North America America America America 10.3% America 10.3% 19.0% 2.9% 2.9% 19.0% Rest Restofof Latin Latin Asia- Asia- America America Pacif
Slide 10: Analysis of growth in operating profit before provisions
Analysis of growth in Operating profit before provisions (Cash (Cash basis basis & & constant currency)) constant currency Commercial Commercial Investment Investment TOTAL TOTAL + 7% banking banking banking banking $m $m $m $m $m $m CCF CCF Operating Operating revenues revenues 677 677 323 323 1,00
Slide 11: Operating income growth within Rest of Asia-Pacific
Operating income growth within Rest of Asia-Pacific (constant (constant currency) currency) Growth on H100 $m Sri Sri Lanka Lanka 50% 50% 6 Philippines Philippines 50% 50% 16 China China 42% 42% 11 Mauritius Mauritius 40% 40% 6 Indonesia Indonesia 34% 34% 14 India India 22% 22% 20 Taiwan Taiwan 21%
Slide 12: Earnings growth achieved with low leverage
Earnings growth achieved with low leverage 4.0% 4.0% 3.5% 50% 50% 3.5% 3.0% 3.0% 45% 45% 2.5% 2.5% 40% 40% 2.0% 2.0% 1.5% 1.5% 35% 35% 1.0% 1.0% 30% 30% 0.5% 0.5% 0.0% 0.0% 25% 25% H1 H1 99 99 H2 H2 99 99 H1 H1 00 00 H200 H200 H101 H101 Post-tax return on average risk-weighted assets (cash basis) Cu
Slide 13: Operating margin
Operating margin (Operating (Operating profit profit before before provisions, provisions, excluding excluding goodwill goodwill amortisation amortisation as as % % of of average average risk-weighted risk-weighted assets) assets) Bad debt charge (Bad (Bad debt debt charge charge as as % % of of 4.0
Slide 14: Dealing profits as % of Revenues
Dealing profits as % of Revenues 10% 10% 7.8% 7.8% 8% 8% 7.3% 7.3% 6.8% 6.8% 6.0% 6.0% 6% 6% 4.6% 4.6% 4% 4% 2% 2% 0% 0% H199 H199 H299 H299 H100 H100 H200 H200 H101 H101 2001 Interim Results 14 =>? =>
Slide 15: Market risk-related revenues in H1 2001
Market risk-related revenues in H1 2001 averaged US$13.6m a day Daily distribution of Market Risk Revenues 18 Group Treasury Centres 16 14 C C P&L P&L frequency frequency H1 H1 2001 2001 days of days 12 C C P&L P&L frequency frequency H1 H1 2000 2000 10 Number of Number 8 6 4 2 0 -4 -2 0 2 4 6 8 10
Slide 16: Credit quality remains satisfactory
Credit quality remains satisfactory Non-performing Non-performing loans loans Specific Specific provisions provisions Europe Europe Hong Hong Kong Kong Rest Rest of of Asia-Pacific Asia-Pacific 3.00% 3.00% 6.00% 6.00% 12.00% 12.00% 2.50% 2.50% 5.00% 5.00% 10.00% 10.00% 2.00% 2.00% 4.00% 4.00% 8.00%
Slide 17: Republic synergy scorecards
Republic synergy scorecards SAVINGS SAVINGS INTEGRATION INTEGRATION ✔ $480M pre-tax identified & ✔ Effectively complete achieved ✔ Grown assets under management of which 80% within US ✔ Minimal deposit runoff 20% overseas ✔ Harmonised job evaluation and compensation involving 60% from personnel ✔ In
Slide 18: CCF synergy scorecards
CCF synergy scorecards REVENUES REVENUES COSTS COSTS ✔ Major wins in bond mandates, ✔ Consolidation of government syndicated loans, advisory, bond business in Paris payments & cash management ✔ Integration of CCF Brazil into ✔ #7 in Euro Corporate Bonds HSBC Brazil operations league table (2000: #16
Slide 19: CCF synergy scorecards
CCF synergy scorecards SALES SALES OF OF OVERLAPPING OVERLAPPING BUSINESSES BUSINESSES ✔ Charterhouse Securities Limited ✔ Quilter Holdings Ltd (20.2%) ✔ Crédit International d’Egypte (93.3%) ✔ Charterhouse Development Capital Holdings Limited 2001 Interim Results 19 =>? =>
Slide 20: Principal objectives for 2001 - half year update
Principal objectives for 2001 -- half half year year update update SCORECARD SCORECARD • Expand personal internet ➠ ✔ 3 DONE banking into at least 10 more 7 ON TRACK FOR THE countries SECOND HALF • Launch business internet ➠ UK IN SECOND HALF OF 2001 banking in 4 countries NEXT 3 IN 2002 • MLHSBC to
Slide 21: Business outlook for H2 2001
Business outlook for H2 2001 • HSBC positioned for a challenging environment • Outlook for financial services industry unclear Ø Ø US US economy economy pivotal pivotal • HSBC is Ø Diversified Ø International • HSBC will Ø Invest for growth Ø Manage for value 2001 Interim Results 21 =>? =>
Slide 22: Your world of financial services
YOUR WORLD OF FINANCIAL SERVICES =>@ =>@A