We are one of the most international banking and financial services organisations in the world.
Our operating model consists of four global businesses, a Corporate Centre and five geographical regions, supported by 11 global functions.
- Adjusted profit before tax up 12%, adjusted revenue up 2% compared with 1Q 2016
- Revenue and loan growth in all three of our main businesses
- Strong momentum in Asia with continued investment and growth in the Pearl River Delta
- Adjusted loan impairment charges down 71% compared with 1Q 2016
- Capital ratios continued to strengthen, with common equity tier 1 ratio rising to 14.3%
“This is a good set of results. The increase in adjusted profit was driven by strong performances in three of our four global businesses. Global Banking and Markets had a great quarter; Commercial Banking delivered higher revenue from our liquidity and cash management activities; and Retail Banking and Wealth Management was supported by rising interest rates and renewed customer investment appetite.”
Stuart Gulliver, HSBC Group Chief Executive
4 May 2017
Delivering for shareholders
We completed a US$1bn buy-back and made progress on our cost-saving programmes, giving us further confidence in our ability to hit the higher cost-saving target that we announced at our annual results.
Return on equity
Our medium-term target is to achieve a return on equity (RoE) of more than 10%.
In the first quarter of 2017, the return on average ordinary shareholders’ equity was 8.0%. Return on average tangible equity was 9.1%.
Excluding significant items and the UK bank levy, return on average ordinary shareholders’ equity would have been 10% and return on average tangible equity would have been 11.3%.
Return on average ordinary shareholders’ equity
Return on average tangible equity
Adjusted revenues (US$m)
Adjusted Group revenue in 1Q 2017 was up 2% on 1Q 2016. Across our four global businesses adjusted revenue was up 9%. Retail Banking and Wealth Management was up 15%, Global Banking and Markets up 10%, Commercial Banking up 1%, and Global Private Banking down 8%.
Corporate Centre adjusted revenue was down US$0.7bn, reflecting an increase in interest expense on our debt, lower revenue from the US consumer and mortgage lending (CML) run-off portfolio and from less favourable valuation differences on long-term debt and associated swaps.
Dividends declared (US$ per ordinary share)
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 our Investor Update in June 2015.
Iain Mackay, Group Finance Director, HSBC, discusses the bank’s capital strength and returns for shareholders.