3Q 2017 update

The 3Q 2017 Earnings Release, investor presentation and data pack are available to download.

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.

4.6
Billion USD
Reported profit before tax
(3Q16: US$0.8bn)
5.4
Billion USD
Adjusted profit before tax
(3Q16: US$5.5bn)
13.0
Billion USD
Adjusted revenue
(3Q16: US$12.7bn)
14.6
per cent
Common equity tier 1 ratio
(2Q17: 14.7%)

Key highlights

  • Continued to make good progress with actions to deploy capital and invest, including delivering growth from our international network and our pivot to Asia
  • Achieved annualised run-rate savings of US$5.2bn since our investor update. We remain committed to delivering positive adjusted jaws for 2017
  • Total risk-weighted assets (RWAs) grew by US$12.5bn to US$889bn, driven primarily by strong loan growth and foreign exchange movements. Further US$13bn of strategic RWA reductions in 3Q17, bringing the total reduction since the start of 2015 to US$309bn
  • Completed 71% of the most recent US$2bn share buy-back as at 26 October

Group Chief Executive

“We maintained good momentum in the third quarter, with higher revenue in our three main global businesses. We also continued to make good progress with the strategic actions we set out in 2015.”

Stuart Gulliver, HSBC Group Chief Executive
30 October 2017

 

Pivot to Asia

Our international network continued to deliver strong growth in the third quarter, and our pivot to Asia is driving higher returns and lending growth, particularly in Hong Kong. HSBC was named Best Overall International Bank for the Belt and Road Initiative at the Asiamoney New Silk Road Finance Awards in September.

Financial targets

Delivering on our group financial targets



Our medium-term target is to achieve a return on equity (RoE) of more than 10%. In 9M17, we achieved an RoE of 8.2%, compared with 4.4% in 9M16.

The return on average tangible shareholders’ equity was 9.3%, up from 5.3% in 9M16.

Return on average ordinary shareholders’ equity

(% annualised)
9M17 8.2
9M16 4.4

Return on average tangible equity

(% annualised)
9M17 9.3
9M16 5.3
%
Adjusted revenue up 3
Adjusted jaws -1.3
Adjusted costs up 4.3

Adjusted jaws for 9M17

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.

Adjusted jaws for 9M17 was negative 1.3%, although we achieved positive adjusted jaws in our three largest global businesses. We remain committed to delivering positive adjusted jaws for the full year.

Dividends per ordinary share in respect of period

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.

9M17 0.3
9M16 0.3

Video

Group Finance Director Iain Mackay explains how HSBC’s momentum is allowing it to invest in growth.

Iain Mackay, Group Finance Director, HSBC (duration 2:30)

Downloads

3Q 2017 Earnings Release

Main photograph: Victoria Harbour, Hong Kong by Bettina Wassener, HSBC Hong Kong