HSBC Holdings plc Interim Results 2017

 

At a glance

Our international network, universal banking model and capital strength deliver long-term value for customers and shareholders.

Our operating model consists of four global businesses and a Corporate Centre, supported by 11 global functions.

For the half-year to 30 June 2017

Reported profit before tax
(1H16: US$9.7bn)

US$10.2bn

Adjusted profit before tax
(1H16: US$10.7bn)

US$12.0bn

Reported revenue
(1H16: US$29.5bn)

US$26.2bn

At 30 June 2017

Risk-weighted assets
(31 Dec 2016: US$857.2bn)

US$876.1bn

Common equity tier 1 ratio
(31 Dec 2016: 13.6%)

14.7%

Total assets
(31 Dec 2016: US$2,375bn)

US$2,492bn

Key highlights

  • Adjusted profit before tax (PBT) up 12% with adjusted revenue up 3% compared with 1H16; adjusted jaws was positive 0.5%
  • Adjusted revenue and PBT growth in all three of our largest global businesses
  • Achieved annualised run-rate savings of US$4.7bn since Investor Update with incremental savings of US$1.0bn in 1H17
  • Significant progress against the strategic actions announced in June 2015; on course to complete the majority on schedule by the end of 2017
  • Capital ratios continued to strengthen, with common equity tier 1 ratio rising to 14.7%
Find out more about Our strategy.

Group Chairman’s Statement

Douglas Flint, HSBC Group Chairman

“The Group delivered strong results across its major businesses, providing further evidence of a successful repositioning. Its diversified business model, international network and capital strength provide a solid foundation for further growth.”

Douglas Flint, HSBC Group Chairman
31 July 2017

Further share buy-back

The Group’s capital position remains strong, with the common equity tier 1 ratio standing at 14.7% at 30 June…In light of the strong capital position, the Board approved a further buy-back of up to $2.0bn of ordinary shares, planned to commence shortly after publication of these interim results.

Group Chief Executive’s Review

Stuart Gulliver, HSBC Group Chief Executive

Financial targets

Delivering on our Group financial targets

Return on equity
(%)

1H17 8.8%
1H16 7.4%

Return on average tangible equity (%)

1H17 9.9
1H16 9.3


Our medium-term target is to achieve a return on equity (RoE) of more than 10%. In 1H17, we achieved an RoE of 8.8%, compared with 7.4% in 1H16.






The return on tangible shareholders’ equity was 9.9%, up from 9.3% in 1H16.

Adjusted jaws

Adjusted jaws in per cent to 30 June 2016; 1Q16 negative 2.8 per cent; 2Q16 positive 1.4 per cent; 1H16 negative 0.5 per cent



Jaws measures the difference between the rates of change in revenue and costs. Positive jaws occurs when the figure for the percentage change in revenue is higher than, or less negative than, the corresponding rate for costs. We calculate adjusted jaws using adjusted revenue and costs.

Our target is to maintain positive adjusted jaws.

In 1H17, adjusted revenue increased by 3.2%, whereas our adjusted operating expenses increased by 2.7%. Adjusted jaws was therefore positive 0.5%.

Total dividends declared in respect of the half-year
(US$m)

Jun 2017 US$4,020
Dec 2016 US$6,159
Jun 2016 US$3,972


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 in the future 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 the Investor Update in June 2015.

Video

Iain Mackay, Group Finance Director, HSBC, discusses the bank’s Interim Results, its international network and value to customers.

Iain Mackay, Group Finance Director, HSBC