We have developed a long-term strategy that reflects our purpose and enables us to capture value from our international network.
Our long-term, two-part strategy is to:
Develop our international network
To serve enterprises across geographies and facilitate international trade and capital flows, thereby helping our clients to grow their businesses.
Invest in wealth and retail businesses with local scale
To make the most of global social mobility, wealth creation and long-term demographic changes in our selected retail banking and wealth management markets.
This strategy positions us to capitalise on several long-term trends:
Increasing connectivity and global flows of trade, finance and data are key drivers of GDP growth
Emerging market economies are expected to be twice the size of developed economies by 2050
The global middle class is expected to grow by more than two billion people from 2017 to 2030, driven by growth in Asia’s middle class
Significant investment in renewable energy is needed to tackle climate change
The value of our network
HSBC’s unparalleled international network covers countries accounting for approximately 90 per cent of global GDP, trade and capital flows. We have a leading presence in large and fast-growing economies, and our network covers all of the trade corridors forecast to be the world’s largest by 2030. These 30 corridors are expected to have a compound annual growth rate well in excess of GDP growth expectations from 2016 to 2030. Read more about the value of our network.
We operate a balanced universal banking model across both wholesale and retail businesses and we are geographically diversified. This has resulted in a lower risk profile and lower earnings volatility compared with our global peers.
We aim to achieve a return on equity of more than 10 per cent in the medium term. We aim to grow business revenues faster than operating expenses on an adjusted basis. In the current uncertain environment, we plan to sustain the annual dividend in respect of the year at its current level for the foreseeable future. Growing our dividend will depend on the overall profitability of the Group, delivering further release of less efficiently deployed capital and meeting regulatory capital requirements in a timely manner. Actions to address these points were core elements of our Investor Update in June 2015.
Delivering these priorities will create value for our customers and shareholders and contribute to the long-term sustainability of HSBC. In the process, we shall maintain a robust, resilient and environmentally sustainable business in which our customers can have confidence, our employees can take pride and our communities can trust.