HSBC HOLDINGS PLC
2024 Interim results
Noel Quinn, Group Chief Executive,
said:
"After delivering record profits in
2023, we had another strong profit performance in the first half of
2024, which is further evidence that our strategy is working. Our
investment in Wealth is delivering higher, more diversified revenue
and we continue to grow our core international and scale
businesses, all of which helped us to provide $13.7bn of
distributions in respect of the first half. We are confident that
we have the right strategy and model to grow revenue, even in a
lower interest rate environment, and are therefore providing new
guidance of a mid-teens return on average tangible equity in
2025.
I have always been immensely proud of
the heritage of this bank and the strategic role it plays in the
world. My aim when I took this job was to deliver financial
performance to match our standing. Working together, I believe we
have done that and created a strong platform for
growth."
Financial performance in
1H24
- Profit before tax of $21.6bn
was stable compared with 1H23, including a $0.2bn net favourable revenue impact of notable
items relating to gains and losses recognised on certain strategic
transactions. Profit after tax of
$17.7bn was $0.4bn or 2% lower compared with
1H23.
- In 1H24, we completed the disposal of our banking business in
Canada, recognising a gain of $4.8bn. We also recognised an
impairment of $1.2bn following the classification of our business
in Argentina as held for sale. Results in 1H23 included the impact
of a $2.1bn reversal of an impairment relating to the sale of our
retail banking operations in France and a $1.5bn gain recognised on
the acquisition of Silicon Valley Bank UK Limited ('SVB UK').
- Constant currency profit
before tax excluding notable items was stable at $18.1bn compared
with 1H23, as revenue growth and
lower expected credit losses and other impairment charges ('ECL')
were offset by a rise in operating expenses.
- Revenue rose by $0.4bn or 1%
to $37.3bn compared with 1H23, including the gains and losses on certain strategic
transactions described above. Net interest income ('NII') fell by
$1.4bn, as growth in HSBC UK and a number of other
markets was more than offset by reductions due to business
disposals, deposit migration, and redeployment into the trading
book in HSBC Bank plc and our main entity in Hong Kong. The
increase in funding costs associated with funding the trading book
resulted in an increase in banking net interest income ('banking
NII') of $0.3bn or 1%.
- Revenue growth also reflected the impact of higher customer
activity in our Wealth products in Wealth and Personal Banking
('WPB'), and in Equities and Securities Financing in Global Banking
and Markets ('GBM'). Constant
currency revenue excluding notable items rose by 2% to
$33.7bn, primarily due to growth in Wealth in WPB, in
Equities and Securities Financing in GBM, as well as an increase in
Global Payment Solutions ('GPS').
- Net interest margin ('NIM')
of 1.62% decreased by 8 basis points ('bps') compared with
1H23, reflecting a rise in the
funding cost of average interest-bearing liabilities.
- ECL charges were $1.1bn, a
reduction of $0.3bn compared with 1H23. The reduction reflected a release of stage 3 allowances in GBM
in HSBC Bank plc, lower ECL in Commercial Banking ('CMB') in HSBC
UK, and lower charges in the commercial real estate sector in
mainland China. In WPB, ECL charges were broadly stable as a
release of allowances in the UK was offset by higher charges in
Mexico, reflecting unemployment trends and growth in our unsecured
portfolio. Annualised ECL were
22bps of average gross loans, including a 4bps reduction due
to the inclusion of loans and advances classified as held for
sale.
- Operating expenses of $16.3bn
were $0.8bn or 5% higher than in 1H23, mainly due to higher technology spend and investment,
inflationary pressures and an increase in the performance-related
pay accrual. Target basis
operating expenses rose by 7% compared with 1H23. This is
measured on a constant currency basis, excluding notable items, the
impact of retranslating the prior year results of hyperinflationary
economies at constant currency, and the direct costs from the sales
of our France retail banking operations and our banking business in
Canada.
- Customer lending balances of
$938bn were stable on a reported basis, and increased by $12bn on a constant currency basis, compared
with 31 December 2023. Growth included higher balances in HSBC
Bank plc in both CMB and GBM, and higher term lending in CMB in our
entities in mainland China and India. In addition, mortgage
balances increased in HSBC UK in WPB.
- Customer accounts of $1.6tn
fell by $18bn on a reported basis, and increased by $3bn on a constant currency basis compared
with 31 December 2023, notably in GBM reflecting growth in
time deposit balances in Asia. The increase in GBM included a
short-term deposit from a single corporate customer.
- Common equity tier 1 ('CET1')
capital ratio of 15.0% rose by 0.2 percentage points compared with
4Q23, driven by a reduction in
risk-weighted assets ('RWAs'), partly offset by a reduction in our
CET1 capital.
- The Board has approved a second interim dividend of $0.10 per
share. We also intend to initiate a share buy-back of up to $3bn, which we
expect to complete within three months.
Financial performance in
2Q24
- Reported profit before tax
increased by $0.1bn to $8.9bn compared with 2Q23,
due to a lower ECL charge, which more than offset
higher operating expenses and lower revenue. On a constant currency basis, profit before
tax increased by $0.4bn or 4%.
- Revenue fell by $0.2bn to
$16.5bn compared with 2Q23, notably
as 2Q23 included the operating results of France and Canada for
which sales completed in 1Q24. In addition, 2Q24 included a loss
related to the recycling of reserves following the completion of
the sale of our business in Russia. This was partly offset by
growth in Securities Financing and Equities in GBM and from Wealth
in WPB.
- ECL of $0.3bn decreased by
$0.6bn, reflecting lower charges in
2Q24 in the commercial real estate sector in mainland China,
compared with 2Q23, as well as a reduction in charges in HSBC UK,
and the release of stage 3 allowances in GBM in HSBC Bank
plc.
- Operating expenses of $8.1bn
rose by $0.3bn or 3%, due to higher
technology costs, including investment, the 2Q23 reversal of
historical asset impairments, which did not recur, and inflationary
impacts. This was partly offset by reductions following the
completion of disposals in Canada and France.
- Customer lending increased by
$5bn compared with 1Q24 on a reported basis
and by $8bn on a constant currency basis. The
growth was mainly from CMB, notably in our entities in mainland
China and India, and in WPB from mortgage balance growth in HSBC UK
and our entity in the US.
- Customer accounts increased
by $24bn compared with 1Q24 on a reported basis
and by $27bn on a constant currency basis. The
increase was across all businesses, primarily in Asia. The increase
included a short-term deposit from a single corporate
customer.
Outlook
- We will now target a return
on average tangible equity ('RoTE'), excluding the impact of
notable items, in the mid-teens for both 2024 and
2025.
- Based upon our current forecasts, we expect banking NII of around $43bn in
2024. This guidance remains dependent on the path of
interest rates globally.
- While loan growth was 1% in 1H24, revenue has continued to
benefit from elevated interest rates. Over the medium to long term, we continue to
expect mid-single digit year-on-year percentage growth in customer
lending.
- We are reiterating our cost
growth guidance of approximately 5% for 2024
compared with 2023, on a target basis, and now
expect ECL charges as a percentage
of average gross loans in 2024 to be within our medium-term
planning range of 30bps to 40bps (including customer lending
balances transferred to held for sale).
- Our guidance reflects our current outlook for the global
macroeconomic environment, including customer and financial markets
activity. This includes our modelling of a number of market
dependent factors, such as market-implied interest rates (as of
mid-July 2024), as well as customer behaviour and activity
levels.
- We intend to manage our CET1
capital ratio within our medium-term target range of 14% to 14.5%,
with a dividend payout ratio target basis of 50% for
2024, which excludes material
notable items and related impacts.
- Note: we do not reconcile our forward guidance on RoTE
excluding notable items, target basis operating expenses, dividend
payout ratio target basis or banking NII to their equivalent
reported measures.
Key financial metrics
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
Reported results
|
|
|
Profit before tax ($m)
|
21,556
|
21,657
|
Profit after tax ($m)
|
17,665
|
18,071
|
Cost efficiency ratio (%)
|
43.7
|
41.9
|
Net interest margin (%)
|
1.62
|
1.70
|
Basic earnings per share
($)
|
0.89
|
0.86
|
Diluted earnings per share
($)
|
0.88
|
0.86
|
Dividend per ordinary share (in
respect of the period) ($)1
|
0.20
|
0.20
|
Alternative performance measures
|
|
|
Constant currency profit before tax
($m)
|
21,556
|
21,472
|
Constant currency cost efficiency
ratio (%)
|
43.7
|
41.8
|
Constant currency revenue excluding
notable items ($m)
|
33,721
|
33,075
|
Constant currency profit before tax
excluding notable items ($m)
|
18,067
|
18,117
|
Constant currency revenue excluding
notable items and strategic transactions ($m)
|
33,543
|
32,462
|
Constant currency profit before tax
excluding notable items and strategic transactions ($m)
|
17,975
|
17,969
|
Expected credit losses and other
credit impairment charges (annualised) as % of average gross loans
and advances to customers (%)
|
0.23
|
0.28
|
Expected credit losses and other
credit impairment charges (annualised) as % of average gross loans
and advances to customers, including held for sale (%)
|
0.22
|
0.26
|
Basic earnings per share excluding
material notable items and related impacts ($)
|
0.68
|
0.70
|
Return on average ordinary
shareholders' equity (annualised) (%)
|
19.8
|
20.8
|
Return on average tangible equity
(annualised) (%)
|
21.4
|
22.4
|
Return on average tangible equity
excluding notable items (annualised) (%)
|
17.0
|
18.5
|
Target basis operating expenses
($m)
|
16,052
|
14,983
|
|
|
|
|
At
|
|
30 Jun 2024
|
31 Dec
2023
|
Balance sheet
|
|
|
Total assets ($m)
|
2,975,003
|
3,038,677
|
Net loans and advances to customers
($m)
|
938,257
|
938,535
|
Customer accounts ($m)
|
1,593,834
|
1,611,647
|
Average interest-earning assets, year
to date ($m)
|
2,097,866
|
2,161,746
|
Loans and advances to customers as %
of customer accounts (%)
|
58.9
|
58.2
|
Total shareholders' equity
($m)
|
183,293
|
185,329
|
Tangible ordinary shareholders'
equity ($m)
|
153,109
|
155,710
|
Net asset value per ordinary share at
period end ($)
|
8.97
|
8.82
|
Tangible net asset value per ordinary
share at period end ($)
|
8.35
|
8.19
|
Capital, leverage and liquidity
|
|
|
Common equity tier 1 capital ratio
(%)2
|
15.0
|
14.8
|
Risk-weighted assets
($m)2,3
|
835,118
|
854,114
|
Total capital ratio
(%)2,3
|
20.6
|
20.0
|
Leverage ratio
(%)2,3
|
5.7
|
5.6
|
High-quality liquid assets (liquidity
value, average) ($m)3,4
|
646,052
|
647,505
|
Liquidity coverage ratio (average)
(%)3,4,5
|
137
|
136
|
Share count
|
|
|
Period end basic number of $0.50
ordinary shares outstanding (millions)
|
18,330
|
19,006
|
Period end basic number of $0.50
ordinary shares outstanding and dilutive potential ordinary shares
(millions)
|
18,456
|
19,135
|
Average basic number of $0.50
ordinary shares outstanding (millions)
|
18,666
|
19,478
|
|
|
|
For reconciliations of our reported
results to a constant currency basis, including lists of notable
items, see page 40 of the Interim Report 2024. For detail on other
alternative performance measures, including definitions and
calculations, see 'Reconciliation of alternative performance
measures' on pages 56 to 61 of the Interim Report 2024.
1 Dividend per
ordinary share for half year to 30 June 2024 excludes the special
dividend of $0.21 per ordinary share arising from the proceeds of
the sale of our banking business in Canada to Royal Bank of
Canada.
2 Unless otherwise
stated, regulatory capital ratios and requirements are based on the
transitional arrangements of the Capital Requirements Regulation in
force at the time. References to EU regulations and directives
(including technical standards) should, as applicable, be read as
references to the UK's version of such regulation or directive, as
onshored into UK law under the European Union (Withdrawal) Act
2018, and as may be subsequently amended under UK law.
3 Regulatory
numbers and ratios are as presented at the date of reporting. Small
changes may exist between these numbers and ratios and those
subsequently submitted in regulatory filings. Where differences are
significant, we may restate in subsequent periods.
4 The liquidity
coverage ratio is based on the average value of the preceding 12
months.
5 We have enhanced
our calculation processes during 1H24. As Group LCR is reported as
a 12-month average, the benefit of these changes will be recognised
incrementally over the coming year starting from 30 June
2024.
Highlights
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
$m
|
Reported
|
|
|
Revenue1,2,3,4
|
37,292
|
36,876
|
Change in expected credit losses and
other credit impairment charges
|
(1,066)
|
(1,345)
|
Operating expenses
|
(16,296)
|
(15,457)
|
Share of profit in associates and
joint ventures
|
1,626
|
1,583
|
Profit before tax
|
21,556
|
21,657
|
Tax (charge)/credit
|
(3,891)
|
(3,586)
|
Profit after tax
|
17,665
|
18,071
|
Constant currency5
|
|
|
Revenue1,2,3,4
|
37,292
|
36,502
|
Change in expected credit losses and
other credit impairment charges
|
(1,066)
|
(1,317)
|
Operating expenses
|
(16,296)
|
(15,244)
|
Share of profit in associates and
joint ventures
|
1,626
|
1,531
|
Profit before tax
|
21,556
|
21,472
|
Tax (charge)/credit
|
(3,891)
|
(3,514)
|
Profit after tax
|
17,665
|
17,958
|
|
|
|
Notable items
|
|
|
Revenue
|
|
|
Disposals, acquisitions and related
costs2,3,4
|
3,571
|
3,321
|
Fair value movements on financial
instruments6
|
-
|
15
|
Operating expenses
|
|
|
Disposals, acquisitions and related
costs
|
(101)
|
(118)
|
Restructuring and other related
costs7
|
19
|
47
|
Tax
|
|
|
Tax (charge)/credit on notable
items
|
14
|
(500)
|
Uncertain tax positions
|
-
|
427
|
1 Net
operating income before change in expected credit losses and other
credit impairment charges, also referred to as revenue.
2 Includes
the reversal of a $2.1bn impairment loss relating to the sale of
our retail banking operations in France in 1Q23.
3 Includes a $4.8bn
gain on disposal of our banking business in Canada, inclusive of a
$0.3bn gain on the foreign exchange hedging of the sale proceeds,
the recycling of $0.6bn in foreign currency translation reserve
losses and $0.4bn of other reserves recycling losses. This is
partly offset by a $1.2bn impairment recognised in relation to the
planned sale of our business in Argentina.
4 Includes the gain
of $1.5bn recognised in respect of the acquisition of SVB UK in
1Q23.
5 Constant currency
performance is computed by adjusting reported results of
comparative periods for the effects of foreign currency translation
differences, which distort period-on-period comparisons.
6 Fair value
movements on non-qualifying hedges in HSBC Holdings.
7 Relates to
reversals of restructuring provisions recognised during
2022.
Review by Noel Quinn, Group Chief
Executive
After achieving a record profit
performance in 2023, we had a strong first half financial
performance that reflected our strategy execution and revenue
diversification over the past five years. We remain confident that
we can deliver attractive returns, even in a lower interest rate
environment, as a result of macroeconomic trends that play to our
strengths, market-leading businesses connecting high-growth markets
that we are continuing to invest in, and ongoing cost discipline.
As a result, we are providing new guidance of a mid-teens return on
average tangible equity, excluding the impact of notable items, in
2025.
Over the last 18 months, HSBC's
business model has delivered our highest return on average tangible
equity for more than a decade. We continued to perform well in our
home markets of Hong Kong and the UK - the two pillars upon which
our bank is built. The international wholesale banking business
that we have built on top of these pillars is mature and
differentiated, and has substantial scale. It remains our biggest
competitive advantage and is supported by leading transaction
banking products and services in global trade, payments and foreign
exchange. Finally, we are growing and investing in our
international retail and wealth business to sit alongside this,
which is helping to diversify revenue.
Each of these strengths contributed
to a good revenue performance in the first half of 2024, supported
by higher interest rates. Our strategy is working and providing
attractive returns for our shareholders. We have announced a second
interim dividend of $0.10 per share, further to the first interim
dividend of $0.10 per share and the special dividend of $0.21 paid
in June. We are also today announcing a share buy-back of up to
$3bn, further to the now completed $3bn share buy-back announced at
our first quarter results. This means that we are announcing a
further $4.8bn in distributions with these results, taking the
amount of capital distributed in respect of the last 18 months to
$34.4bn.
As we look ahead, the path of
interest rates and the outcomes of elections are amongst the
factors that will shape the global operating environment. The
progress that has been made reducing inflation has enabled central
banks to start cutting interest rates. Although we expect a
cautious approach, we have reduced our sensitivity to interest
rates. 2024 will also be the biggest election year on record, as
more than 4 billion people have an opportunity to go to the polls.
The US election result will be watched particularly closely
considering the potential for policy change based on the result and
the impact this could have beyond its borders. We will continue to
monitor these situations.
Continued strong financial performance
The first half saw another strong
profit performance, driven by growth in our scale businesses and in
areas where we have been investing. There was strong revenue growth
in Wealth, transaction banking revenue remained stable and
wholesale lending increased again in the second quarter, on a
constant currency basis, after growing in the first
quarter.
Profit before tax for the first half
was $21.6bn, which was stable compared with the first half of 2023.
This included a $4.8bn gain on the sale of our banking operations
in Canada, partly offset by a $1.2bn impairment related to the
planned sale of our banking operations in Argentina, which was
announced in the first half. The prior year also included a $2.1bn
reversal of an impairment relating to the sale of our retail
banking operations in France and a $1.5bn gain recognised on the
acquisition of SVB UK.
Revenue increased by $0.4bn or 1% to
$37.3bn, including the aforementioned acquisition and disposal
impacts, driven mainly by higher banking net interest income. We
achieved an annualised return on average tangible equity of 21.4%,
or 17% excluding notable items.
Our three global businesses continued
to perform well. In Wealth and Personal Banking, profit before tax
of $6.5bn was $2.2bn lower than in 2023 on a constant currency
basis, primarily due to the non-recurrence of a $2.1bn reversal
last year of an impairment relating to the sale of our retail
banking operations in France and $0.1bn of profit before tax in the
prior period from our Canadian banking operations. Wealth revenue
of $4.3bn was 12% higher than the first half of last year, driven
by increases in investment distribution and Global Private Banking,
as well as growth in asset management and life
insurance.
In Commercial Banking, profit before
tax of $6.5bn was down by $1.5bn on a constant currency basis,
primarily due to the non-recurrence of a $1.6bn gain last year on
the acquisition of SVB UK. Overall performance remained good, with
revenue benefiting from the higher rates environment, growth in
transaction banking and higher collaboration revenue.
Global Banking and Markets delivered
a good performance. Revenue grew by 5% on a constant currency
basis, with good growth in areas like Equities and Securities
Financing, while still benefiting from the interest rate
environment.
First half operating expenses of
$16.3bn were around 5% higher than in 2023, mainly due to higher
technology costs including investments, inflationary pressures and
different phasing of the accrual of performance-related pay
compared with 2023. On a target basis, operating expenses were 7%
higher than the same period last year. As we expect the overall
amount of performance-related pay for 2024 not to be materially
different to 2023, we expect lower performance-related pay accrual
in the second half. We are therefore reconfirming our cost growth
guidance of approximately 5% for 2024 compared with 2023, on a
target basis.
ECL and other credit impairment
charges for the first half were $1.1bn, which was a $0.3bn decrease
on the first half of 2023. We now expect ECLs as a percentage of
average gross loans in 2024 to be back within our medium-term
planning range of 30bps to 40bps. Our CET1 ratio at the end of the
first half was 15.0%.
Our first half banking net interest
income performance and the improved net interest income outlook
mean that we are upgrading our 2024 banking net interest income
guidance from at least $41bn to around $43bn.
Further opportunities to grow revenue
We also expect to deliver a return on
average tangible equity in the mid-teens for 2024 and 2025,
excluding the impact of notable items. Clearly there are downside
risks to net interest income when interest rates fall, but we're
confident that we have the levers to achieve these
targets.
The first lever is leveraging our
international connectivity. We have a strong international
wholesale franchise. After a softer year in 2023, international
trade volumes are forecast to grow more quickly this year and next.
As the world's leading trade finance bank and the third-largest
bank for global foreign exchange revenue since 2021, we expect to
capitalise on this. To illustrate this growth potential, we grew
wholesale multi-jurisdictional client revenue by 4% in the first
half of 2024, on a constant currency basis and excluding HSBC Bank
Canada, from $9.4bn to $9.7bn.
Increasing global mobility amongst
retail customers is also driving demand for innovative cross-border
banking solutions. This helped us to grow international customers
within Wealth and Personal Banking by 11%, bringing the total to 7m
customers. Revenue from these customers also grew by 6% in the
first half. We believe that there is still significant untapped
potential amongst international wholesale and retail
customers.
The second lever is maintaining our leadership in
our home markets. Our leading businesses in Hong Kong and the UK -
two of the biggest global financial centres - both grew profits
before tax in the first half, helped by their strong international
connectivity with the rest of the Group. In Hong Kong, our scale
and connectivity are delivering good profitability and enabling us
to capture new opportunities. In the first half, 345,000
new-to-bank customers opened accounts as we continued to capitalise
on the significant inflows into Hong Kong as customers seek higher
yields and quality products. In the UK, we grew international
customers by 8% to 2.7m, underlining the differentiated nature of
our UK business compared to other UK banks. Signs of economic
recovery were also underlined by growth in customer lending of 2%
compared with the first half of 2023. We remain confident in our
ability to grow further in these two critical markets.
The third lever is investing to
diversify revenue. Over the last five years, we have taken a number
of actions to reduce our sensitivity to interest rates and create
the bank of the future. Building our wealth business, especially in
Asia, to capitalise on increasing affluence has been one of the key
priorities. As a result of this, wealth revenue was up 12% in the
first half, while we attracted $32.4bn of net new invested assets.
Payments is another fee-based business that we are investing in to
capitalise on the expected increase in global payments revenue. We
are the number two bank globally by payments revenue, up from top
four in 2022, with a market share of 4.8% in 2023 compared
with 3.6% in the prior year. HSBC was also named 'World's Best Bank
for Payments and Treasury' by Euromoney, which was one of 33 awards
given to the bank in 2024 that also included 'Best Bank in Asia'
and 'World's Best Bank for Sustainable Finance'.
Through HSBC Innovation Banking, we
are building a global proposition that can help us to become known
as the go-to bank for innovation companies. Revenue from the new
proposition increased by 4% in the second quarter and we have
onboarded almost 600 new-to-bank innovation companies globally
since the acquisition of SVB UK.
Thank you
As I prepare to hand on the
leadership of HSBC to Georges Elhedery in September, I would
like to place on record what an enormous privilege it has been to
lead this great institution. I never imagined when I started my
career 37 years ago that I would have the honour of becoming Group
Chief Executive. I have always been immensely proud of the heritage
of this bank and the strategic role it plays in the world. My aim
when I took this job was to deliver financial performance to match
our standing. Working together, I believe we have done that and
created a strong platform for growth.
The success of our transformation
programme is evident in the improved returns that we have
delivered. Since I became Group Chief Executive, we have returned
$36bn of dividends and $18bn of share buy-backs to our
shareholders, inclusive of the distributions we have announced with
these results, while also successfully navigating the global
pandemic.
This would not have been possible
without the support and backing of the Board, my Group Executive
Committee colleagues and, of course, the whole HSBC team. I have
been very fortunate to work with many talented, dedicated and
committed people during my career. I would like to thank them
wholeheartedly for their friendship and partnership - and I wish
continued success to Georges, and to all those who will write the
next chapter in the story of this great bank.
Noel
Quinn
Group Chief Executive
31 July 2024
Financial summary
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
$m
|
For
the period
|
|
|
Profit before tax
|
21,556
|
21,657
|
Profit attributable to:
|
|
|
- ordinary shareholders of the
parent company
|
16,586
|
16,966
|
Dividends on ordinary
shares1
|
11,691
|
6,591
|
At
the period end
|
|
|
Total shareholders' equity
|
183,293
|
184,170
|
Total regulatory capital
|
172,084
|
170,021
|
Customer accounts
|
1,593,834
|
1,595,769
|
Total assets
|
2,975,003
|
3,041,476
|
Risk-weighted assets
|
835,118
|
859,545
|
Per
ordinary share
|
$
|
$
|
Basic earnings
|
0.89
|
0.86
|
Dividend per ordinary share (paid in
the period)1
|
0.62
|
0.33
|
Net asset
value2
|
8.97
|
8.44
|
1 The $0.62
dividend paid during the period consisted of a fourth interim
dividend of $0.31 per ordinary share in respect of the financial
year ended 31 December 2023 paid in April 2024, a first
interim dividend of $0.10 per ordinary share in respect of the
financial year ending 31 December 2024 and a special dividend of
$0.21 per ordinary share from the Canada sale proceeds.
2 The
definition of net asset value per ordinary share is total
shareholders equity, less non-cumulative preference shares and
capital securities, divided by the number of ordinary shares in
issue, excluding own shares held by the company, including those
purchased and held in treasury.
Distribution of results by global
business
Constant currency profit before
tax
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
%
|
$m
|
%
|
Wealth and Personal
Banking
|
6,458
|
30.0
|
8,626
|
40.2
|
Commercial Banking
|
6,463
|
30.0
|
7,933
|
36.9
|
Global Banking and Markets
|
3,813
|
17.7
|
3,409
|
15.9
|
Corporate
Centre1
|
4,822
|
22.3
|
1,504
|
7.0
|
Profit before tax
|
21,556
|
100.0
|
21,472
|
100.0
|
1 On 1
January 2024, HSBC Continental Europe completed the sale of its
retail banking operations in France to CCF, a subsidiary of
Promontoria MMB SAS ('My Money Group'). With effect from this date,
we have prospectively reclassified the portfolio of retained loans,
profit participation interest and licence agreement of the CCF
brand from WPB to Corporate Centre.
Distribution of results by legal
entity
Reported profit/(loss) before
tax
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
%
|
$m
|
%
|
HSBC UK Bank plc
|
3,734
|
17.3
|
4,791
|
22.1
|
HSBC Bank plc
|
1,436
|
6.7
|
3,498
|
16.2
|
The Hongkong and Shanghai Banking
Corporation Limited
|
10,893
|
50.5
|
10,917
|
50.4
|
HSBC Bank Middle East
Limited
|
536
|
2.5
|
673
|
3.1
|
HSBC North America Holdings
Inc.
|
423
|
2.0
|
701
|
3.2
|
HSBC Bank Canada
|
186
|
0.9
|
475
|
2.2
|
Grupo Financiero HSBC, S.A. de
C.V.
|
466
|
2.2
|
436
|
2.0
|
Other trading
entities1
|
1,034
|
4.7
|
1,282
|
6.0
|
- of which: other Middle East
entities (including Oman, Türkiye, Egypt and Saudi
Arabia)
|
411
|
1.9
|
420
|
1.9
|
- of which: Saudi Awwal
Bank
|
317
|
1.5
|
272
|
1.3
|
Holding companies, shared service
centres and intra-Group eliminations2
|
2,848
|
13.2
|
(1,116)
|
(5.2)
|
Profit before tax
|
21,556
|
100.0
|
21,657
|
100.0
|
1 Other
trading entities includes the results of entities located in Oman
(pre merger with Sohar International Bank SAOG in August 2023),
Türkiye, Egypt and Saudi Arabia (including our share of the results
of Saudi Awwal Bank) which do not consolidate into HSBC Bank Middle
East Limited. Supplementary analysis is provided on page 56 of the
Interim Report 2024 for a fuller picture of the Middle East, North
Africa and Türkiye regional performance.
2 Includes a
$4.8bn gain on disposal of our banking business in Canada,
inclusive of a $0.3bn gain on the foreign exchange hedging of the
sale proceeds, the recycling of $0.6bn in foreign currency
translation reserve losses and $0.4bn of other reserves recycling
losses. This is partly offset by a $1.2bn impairment recognised in
relation to the planned sale of our business in
Argentina.
HSBC constant currency profit before
tax and balance sheet data
|
|
Half-year to 30 Jun
2024
|
|
Wealth and Personal
Banking
|
Commercial
Banking
|
Global
Banking and
Markets
|
Corporate
Centre
|
Total
|
|
$m
|
$m
|
$m
|
$m
|
$m
|
Net
operating income/(expense) before change in expected credit losses
and other credit impairment charges1
|
14,312
|
10,896
|
8,742
|
3,342
|
37,292
|
- external
|
10,166
|
11,217
|
15,377
|
532
|
37,292
|
- inter-segment
|
4,146
|
(321)
|
(6,635)
|
2,810
|
-
|
- of which: net interest
income/(expense)2
|
10,231
|
8,799
|
3,710
|
(5,829)
|
16,911
|
Change in expected credit losses and
other credit impairment charges
|
(476)
|
(573)
|
(11)
|
(6)
|
(1,066)
|
Net
operating income
|
13,836
|
10,323
|
8,731
|
3,336
|
36,226
|
Total operating expenses
|
(7,406)
|
(3,861)
|
(4,918)
|
(111)
|
(16,296)
|
Operating profit
|
6,430
|
6,462
|
3,813
|
3,225
|
19,930
|
Share of profit in associates and
joint ventures
|
28
|
1
|
-
|
1,597
|
1,626
|
Constant currency profit before tax
|
6,458
|
6,463
|
3,813
|
4,822
|
21,556
|
|
%
|
%
|
%
|
%
|
%
|
Share of HSBC's constant currency
profit before tax
|
30.0
|
30.0
|
17.7
|
22.3
|
100.0
|
Constant currency cost efficiency
ratio
|
51.7
|
35.4
|
56.3
|
3.3
|
43.7
|
Constant currency balance sheet data
|
$m
|
$m
|
$m
|
$m
|
$m
|
Loans and advances to customers
(net)
|
445,882
|
310,356
|
174,376
|
7,643
|
938,257
|
Interests in associates and joint
ventures
|
567
|
25
|
111
|
27,762
|
28,465
|
Total external assets
|
864,948
|
597,808
|
1,365,439
|
146,808
|
2,975,003
|
Customer accounts
|
794,807
|
467,362
|
331,269
|
396
|
1,593,834
|
Constant currency risk-weighted
assets3
|
182,508
|
335,692
|
225,145
|
91,773
|
835,118
|
|
|
|
|
|
|
|
Half-year
to 30 Jun 2023
|
Net operating income before change in
expected credit losses and other credit impairment
charges1
|
16,095
|
12,086
|
8,321
|
-
|
36,502
|
- external
|
12,317
|
12,730
|
13,714
|
(2,259)
|
36,502
|
- inter-segment
|
3,778
|
(644)
|
(5,393)
|
2,259
|
-
|
- of which: net interest
income/(expense)2
|
10,130
|
8,073
|
3,401
|
(3,877)
|
17,727
|
Change in expected credit losses and
other credit impairment charges
|
(484)
|
(694)
|
(136)
|
(3)
|
(1,317)
|
Net operating
income/(expense)
|
15,611
|
11,392
|
8,185
|
(3)
|
35,185
|
Total operating expenses
|
(7,020)
|
(3,458)
|
(4,776)
|
10
|
(15,244)
|
Operating profit
|
8,591
|
7,934
|
3,409
|
7
|
19,941
|
Share of profit/(loss) in associates
and joint ventures
|
35
|
(1)
|
-
|
1,497
|
1,531
|
Constant currency profit before
tax
|
8,626
|
7,933
|
3,409
|
1,504
|
21,472
|
|
%
|
%
|
%
|
%
|
%
|
Share of HSBC's constant currency
profit before tax
|
40.2
|
36.9
|
15.9
|
7.0
|
100.0
|
Constant currency cost efficiency
ratio
|
43.6
|
28.6
|
57.4
|
-
|
41.8
|
Constant currency balance sheet
data
|
$m
|
$m
|
$m
|
$m
|
$m
|
Loans and advances to customers
(net)
|
460,395
|
315,271
|
175,055
|
293
|
951,014
|
Interests in associates and joint
ventures
|
551
|
22
|
105
|
28,856
|
29,534
|
Total external assets
|
891,675
|
644,672
|
1,325,327
|
150,047
|
3,011,721
|
Customer accounts
|
803,962
|
466,302
|
309,526
|
628
|
1,580,418
|
Constant currency risk-weighted
assets3
|
181,464
|
345,043
|
224,239
|
91,526
|
842,272
|
1 Net
operating income before change in expected credit losses and other
credit impairment charges, also referred to as revenue.
2 Net
interest expense recognised in the Corporate Centre includes
$5.5bn (1H23: $3.8bn) of interest expense in relation to the internal
cost to fund trading and fair value net assets; and the funding
cost of foreign exchange swaps in our Markets Treasury
function.
3 Constant
currency risk-weighted assets are calculated using reported
risk-weighted assets adjusted for the effects of currency
translation differences.
Consolidated income
statement
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
$m
|
Net interest income
|
16,911
|
18,264
|
- interest income
|
55,372
|
46,955
|
- interest expense
|
(38,461)
|
(28,691)
|
Net fee income
|
6,200
|
6,085
|
- fee income
|
8,158
|
7,947
|
- fee expense
|
(1,958)
|
(1,862)
|
Net income from financial instruments
held for trading or managed on a fair value
basis1
|
10,516
|
8,112
|
Net income from assets and
liabilities of insurance businesses, including related derivatives,
measured at fair value through profit or loss
|
2,376
|
4,304
|
Insurance finance expense
|
(2,486)
|
(4,234)
|
Insurance service result
|
662
|
524
|
- insurance service
revenue
|
1,310
|
1,104
|
- insurance service
expense
|
(648)
|
(580)
|
Gain on
acquisition2
|
-
|
1,507
|
Gain less impairment relating to sale
of business operations3
|
3,256
|
2,130
|
Other operating
(expense)/income
|
(143)
|
184
|
Net
operating income before change in expected credit losses and other
credit impairment charges4
|
37,292
|
36,876
|
Change in expected credit losses and
other credit impairment charges
|
(1,066)
|
(1,345)
|
Net
operating income
|
36,226
|
35,531
|
Employee compensation and
benefits
|
(9,192)
|
(8,954)
|
General and administrative
expenses
|
(5,135)
|
(4,912)
|
Depreciation and impairment of
property, plant and equipment and right-of-use assets
|
(867)
|
(782)
|
Amortisation and impairment of
intangible assets
|
(1,102)
|
(809)
|
Total operating expenses
|
(16,296)
|
(15,457)
|
Operating profit
|
19,930
|
20,074
|
Share of profit in associates and
joint ventures
|
1,626
|
1,583
|
Profit before tax
|
21,556
|
21,657
|
Tax expense
|
(3,891)
|
(3,586)
|
Profit after tax
|
17,665
|
18,071
|
Attributable to:
|
|
|
- ordinary shareholders of the
parent company
|
16,586
|
16,966
|
- other equity
holders
|
526
|
542
|
- non-controlling
interests
|
553
|
563
|
Profit after tax
|
17,665
|
18,071
|
|
$
|
$
|
Basic earnings per ordinary
share
|
0.89
|
0.86
|
Diluted earnings per ordinary
share
|
0.88
|
0.86
|
|
|
|
1 Includes a
$255m gain (1H23: $284m loss) on the foreign exchange hedging of
the proceeds from the sale of our banking business in
Canada.
2 Gain
recognised in respect of the acquisition of SVB UK.
3 In the
first half of 2024, a gain of $4.6bn inclusive of the recycling of
$0.6bn in foreign currency translation reserve losses and $0.4bn of
other reserves recycling losses on the sale of our banking business
in Canada, and an impairment loss of $1.2bn relating to the planned
sale of our business in Argentina was recognised. In the first
quarter of 2023, the $2.1bn reversal of the held for sale
classification was recognised relating to the sale of our retail
banking operations in France.
4 Net
operating income before change in expected credit losses and other
credit impairment charges, also referred to as revenue.
Consolidated statement of
comprehensive income
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
$m
|
Profit for the period
|
17,665
|
18,071
|
Other comprehensive income/(expense)
|
|
|
Items that will be reclassified subsequently to profit or loss
when specific conditions are met:
|
|
|
Debt instruments at fair value
through other comprehensive income
|
(213)
|
549
|
- fair value
(losses)/gains
|
(378)
|
804
|
- fair value gains transferred
to the income statement on disposal
|
(24)
|
(63)
|
- expected credit
losses/(recoveries) recognised in the income statement
|
13
|
(3)
|
- disposal of
subsidiary
|
90
|
-
|
- income taxes
|
86
|
(189)
|
Cash flow hedges
|
(710)
|
(1,062)
|
- fair value losses
|
(612)
|
(1,700)
|
- fair value (gains)/losses
reclassified to the income statement
|
(673)
|
227
|
- disposal of
subsidiary
|
262
|
-
|
- income taxes
|
313
|
411
|
Share of other comprehensive
income/(expense) of associates and joint ventures
|
211
|
101
|
- share for the
period
|
211
|
101
|
Net finance income/(expense) from
insurance contracts
|
17
|
(101)
|
- before income
taxes
|
23
|
(136)
|
- income taxes
|
(6)
|
35
|
Exchange differences
|
(2,588)
|
(347)
|
- foreign exchange losses
reclassified to the income statement on disposal of a foreign
operation
|
648
|
-
|
- other exchange
differences
|
(3,236)
|
(347)
|
Items that will not be reclassified subsequently to profit or
loss:
|
|
|
Fair value gains on property
revaluation
|
5
|
1
|
Remeasurement of defined benefit
asset/(liability)
|
146
|
(112)
|
- before income
taxes
|
178
|
(105)
|
- income taxes
|
(32)
|
(7)
|
Changes in fair value of financial
liabilities designated at fair value upon initial recognition
arising from changes in own credit risk
|
(283)
|
(653)
|
- before income
taxes
|
(372)
|
(867)
|
- income taxes
|
89
|
214
|
Equity instruments designated at fair
value through other comprehensive income
|
41
|
7
|
- fair value gains
|
62
|
7
|
- income taxes
|
(21)
|
-
|
Effects of hyperinflation
|
892
|
578
|
Other comprehensive expense for the period, net of
tax
|
(2,482)
|
(1,039)
|
Total comprehensive income for the period
|
15,183
|
17,032
|
Attributable to:
|
|
|
- ordinary shareholders of the
parent company
|
14,131
|
15,986
|
- other equity
holders
|
526
|
542
|
- non-controlling
interests
|
526
|
504
|
Total comprehensive income for the period
|
15,183
|
17,032
|
Consolidated balance sheet
|
|
At
|
|
30 Jun 2024
|
31 Dec
2023
|
|
$m
|
$m
|
Assets
|
|
|
Cash and balances at central
banks
|
277,112
|
285,868
|
Items in the course of collection
from other banks
|
9,977
|
6,342
|
Hong Kong Government certificates of
indebtedness
|
43,026
|
42,024
|
Trading assets
|
331,307
|
289,159
|
Financial assets designated and
otherwise mandatorily measured at fair value through profit or
loss
|
117,014
|
110,643
|
Derivatives
|
219,269
|
229,714
|
Loans and advances to
banks
|
102,057
|
112,902
|
Loans and advances to
customers
|
938,257
|
938,535
|
Reverse repurchase agreements -
non-trading
|
230,189
|
252,217
|
Financial investments
|
467,356
|
442,763
|
Assets held for sale
|
5,821
|
114,134
|
Prepayments, accrued income and other
assets
|
184,303
|
165,255
|
Current tax assets
|
1,308
|
1,536
|
Interests in associates and joint
ventures
|
28,465
|
27,344
|
Goodwill and intangible
assets
|
12,161
|
12,487
|
Deferred tax assets
|
7,381
|
7,754
|
Total assets
|
2,975,003
|
3,038,677
|
Liabilities
|
|
|
Hong Kong currency notes in
circulation
|
43,026
|
42,024
|
Deposits by banks
|
82,435
|
73,163
|
Customer accounts
|
1,593,834
|
1,611,647
|
Repurchase agreements -
non-trading
|
202,770
|
172,100
|
Items in the course of transmission
to other banks
|
10,482
|
7,295
|
Trading liabilities
|
77,455
|
73,150
|
Financial liabilities designated at
fair value
|
140,800
|
141,426
|
Derivatives
|
217,096
|
234,772
|
Debt securities in issue
|
98,158
|
93,917
|
Liabilities of disposal groups held
for sale
|
5,041
|
108,406
|
Accruals, deferred income and other
liabilities
|
157,171
|
136,606
|
Current tax liabilities
|
2,837
|
2,777
|
Insurance contract
liabilities
|
125,252
|
120,851
|
Provisions
|
1,536
|
1,741
|
Deferred tax liabilities
|
1,186
|
1,238
|
Subordinated liabilities
|
25,510
|
24,954
|
Total liabilities
|
2,784,589
|
2,846,067
|
Equity
|
|
|
Called up share capital
|
9,310
|
9,631
|
Share premium account
|
14,808
|
14,738
|
Other equity instruments
|
18,825
|
17,719
|
Other reserves
|
(14,930)
|
(8,907)
|
Retained earnings
|
155,280
|
152,148
|
Total shareholders' equity
|
183,293
|
185,329
|
Non-controlling interests
|
7,121
|
7,281
|
Total equity
|
190,414
|
192,610
|
Total liabilities and equity
|
2,975,003
|
3,038,677
|
Consolidated statement of changes in
equity
|
|
|
|
Other
reserves
|
|
|
|
|
|
Called up
share
capital
and share
premium
|
Other
equity
instru-ments
|
Financial assets at FVOCI
reserve
|
Cash
flow
hedging
reserve
|
Foreign
exchange
reserve
|
Merger and
other
reserves
|
Insurance
finance
reserve1
|
Retained
earnings
|
Total share-holders'
equity
|
Non-
controlling
interests
|
Total
equity
|
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
At 1
Jan 2024
|
24,369
|
17,719
|
(3,507)
|
(1,033)
|
(33,753)
|
28,601
|
785
|
152,148
|
185,329
|
7,281
|
192,610
|
Profit for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
17,112
|
17,112
|
553
|
17,665
|
Other comprehensive income (net of
tax)
|
-
|
-
|
(164)
|
(691)
|
(2,551)
|
5
|
(10)
|
956
|
(2,455)
|
(27)
|
(2,482)
|
- debt instruments at fair
value through other comprehensive income
|
-
|
-
|
(313)
|
-
|
-
|
-
|
-
|
-
|
(313)
|
10
|
(303)
|
- equity instruments designated
at fair value through other comprehensive income
|
-
|
-
|
35
|
-
|
-
|
-
|
-
|
-
|
35
|
6
|
41
|
- cash flow hedges
|
-
|
-
|
-
|
(970)
|
-
|
-
|
-
|
-
|
(970)
|
(2)
|
(972)
|
- changes in fair value of
financial liabilities designated at fair value upon initial
recognition arising from changes in own credit risk
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(283)
|
(283)
|
-
|
(283)
|
- property
revaluation
|
-
|
-
|
-
|
-
|
-
|
5
|
-
|
-
|
5
|
-
|
5
|
- remeasurement of defined
benefit asset/liability
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
136
|
136
|
10
|
146
|
- share of other comprehensive
income of associates and joint ventures
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
211
|
211
|
-
|
211
|
- effects of
hyperinflation
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
892
|
892
|
-
|
892
|
- foreign exchange losses
reclassified to income statement on disposal of a foreign
operation
|
-
|
-
|
-
|
-
|
648
|
-
|
-
|
-
|
648
|
-
|
648
|
- other reserves
reclassified
to income
statement on
disposal of a
foreign
operation
|
-
|
-
|
90
|
262
|
-
|
-
|
-
|
-
|
352
|
-
|
352
|
- insurance finance
income/
(expense) recognised in
other comprehensive income
|
-
|
-
|
-
|
-
|
-
|
-
|
17
|
-
|
17
|
-
|
17
|
- other exchange
differences
|
-
|
-
|
24
|
17
|
(3,199)
|
-
|
(27)
|
-
|
(3,185)
|
(51)
|
(3,236)
|
Total comprehensive income for the period
|
-
|
-
|
(164)
|
(691)
|
(2,551)
|
5
|
(10)
|
18,068
|
14,657
|
526
|
15,183
|
Shares issued under employee
remuneration and share plans
|
75
|
-
|
-
|
-
|
-
|
-
|
-
|
(75)
|
-
|
-
|
-
|
Capital securities
issued2
|
-
|
1,106
|
-
|
-
|
-
|
-
|
-
|
-
|
1,106
|
-
|
1,106
|
Dividends to shareholders
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(12,217)
|
(12,217)
|
(468)
|
(12,685)
|
Cost of share-based payment
arrangements
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
274
|
274
|
-
|
274
|
Transfers3
|
-
|
-
|
-
|
-
|
-
|
(2,945)
|
-
|
2,945
|
-
|
-
|
-
|
Share
buy-backs4
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(5,019)
|
(5,019)
|
-
|
(5,019)
|
Cancellation of shares
|
(326)
|
-
|
-
|
-
|
-
|
326
|
-
|
-
|
-
|
-
|
-
|
Other movements
|
-
|
-
|
4
|
-
|
-
|
3
|
-
|
(844)
|
(837)
|
(218)
|
(1,055)
|
At
30 Jun 2024
|
24,118
|
18,825
|
(3,667)
|
(1,724)
|
(36,304)
|
25,990
|
775
|
155,280
|
183,293
|
7,121
|
190,414
|
|
Consolidated statement of changes in
equity (continued)
|
|
|
|
Other
reserves
|
|
|
|
|
|
Called
up
share
capital
and share
premium
|
Other
equity
instru-
ments
|
Financial
assets at FVOCI reserve
|
Cash
flow
hedging
reserve
|
Foreign
exchange reserve
|
Merger and
other reserves
|
Insurance
finance
reserve1
|
Retained
earnings
|
Total
share-
holders'
equity
|
Non-
controlling
interests
|
Total
equity
|
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
At 1 Jan 2023
|
24,811
|
19,746
|
(7,038)
|
(3,808)
|
(32,575)
|
33,209
|
1,079
|
142,409
|
177,833
|
7,364
|
185,197
|
Profit for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
17,508
|
17,508
|
563
|
18,071
|
Other comprehensive income (net of
tax)
|
-
|
-
|
560
|
(1,077)
|
(271)
|
1
|
(101)
|
(92)
|
(980)
|
(59)
|
(1,039)
|
- debt instruments at fair
value through other comprehensive income
|
-
|
-
|
546
|
-
|
-
|
-
|
-
|
-
|
546
|
3
|
549
|
- equity instruments designated
at fair value through other comprehensive income
|
-
|
-
|
14
|
-
|
-
|
-
|
-
|
-
|
14
|
(7)
|
7
|
- cash flow hedges
|
-
|
-
|
-
|
(1,077)
|
-
|
-
|
-
|
-
|
(1,077)
|
15
|
(1,062)
|
- changes in fair value of
financial liabilities designated at fair value upon initial
recognition arising from changes in own credit risk
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(654)
|
(654)
|
1
|
(653)
|
- property
revaluation
|
-
|
-
|
-
|
-
|
-
|
1
|
-
|
-
|
1
|
-
|
1
|
- remeasurement of defined
benefit asset/liability
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(117)
|
(117)
|
5
|
(112)
|
- share of other comprehensive
income of associates and joint ventures
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
101
|
101
|
-
|
101
|
- effects of
hyperinflation
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
578
|
578
|
-
|
578
|
- insurance finance income/
(expense) recognised in other comprehensive income
|
-
|
-
|
-
|
-
|
-
|
-
|
(101)
|
-
|
(101)
|
-
|
(101)
|
- other exchange
differences
|
-
|
-
|
-
|
-
|
(271)
|
-
|
-
|
-
|
(271)
|
(76)
|
(347)
|
Total comprehensive income for the
period
|
-
|
-
|
560
|
(1,077)
|
(271)
|
1
|
(101)
|
17,416
|
16,528
|
504
|
17,032
|
Shares issued under employee
remuneration and share plans
|
78
|
-
|
-
|
-
|
-
|
-
|
-
|
(78)
|
-
|
-
|
-
|
Capital securities issued
|
-
|
1,996
|
-
|
-
|
-
|
-
|
-
|
-
|
1,996
|
-
|
1,996
|
Dividends to shareholders
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(7,133)
|
(7,133)
|
(375)
|
(7,508)
|
Redemption of securities
|
-
|
(2,350)
|
-
|
-
|
-
|
-
|
-
|
-
|
(2,350)
|
-
|
(2,350)
|
Cost of share-based payment
arrangements
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
228
|
228
|
-
|
228
|
Share buy-backs
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(2,007)
|
(2,007)
|
-
|
(2,007)
|
Cancellation of shares
|
(79)
|
-
|
-
|
-
|
-
|
79
|
-
|
-
|
-
|
-
|
-
|
Other movements
|
-
|
-
|
6
|
-
|
-
|
1
|
-
|
(932)
|
(925)
|
(12)
|
(937)
|
At 30 Jun 2023
|
24,810
|
19,392
|
(6,472)
|
(4,885)
|
(32,846)
|
33,290
|
978
|
149,903
|
184,170
|
7,481
|
191,651
|
Consolidated statement of changes in
equity (continued)
|
|
|
|
Other
reserves
|
|
|
|
|
|
Called
up
share
capital
and share
premium
|
Other
equity
instru-
ments
|
Financial
assets at FVOCI reserve
|
Cash
flow
hedging
reserve
|
Foreign
exchange reserve
|
Merger and
other reserves
|
Insurance
finance
reserve1
|
Retained
earnings
|
Total
share-
holders'
equity
|
Non-
controlling
interests
|
Total
equity
|
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
At 1 Jul 2023
|
24,810
|
19,392
|
(6,472)
|
(4,885)
|
(32,846)
|
33,290
|
978
|
149,903
|
184,170
|
7,481
|
191,651
|
Profit for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
6,025
|
6,025
|
463
|
6,488
|
Other comprehensive income (net of
tax)
|
-
|
-
|
1,842
|
4,107
|
60
|
-
|
(270)
|
206
|
5,945
|
77
|
6,022
|
- debt instruments at fair
value through other comprehensive income
|
-
|
-
|
2,028
|
-
|
-
|
-
|
-
|
-
|
2,028
|
22
|
2,050
|
- equity instruments designated
at fair value through other comprehensive income
|
-
|
-
|
(107)
|
-
|
-
|
-
|
-
|
-
|
(107)
|
(20)
|
(127)
|
- cash flow hedges
|
-
|
-
|
-
|
3,996
|
-
|
-
|
-
|
-
|
3,996
|
19
|
4,015
|
- changes in fair value of
financial liabilities designated at fair value upon initial
recognition arising from changes in own credit risk
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(566)
|
(566)
|
-
|
(566)
|
- property
revaluation
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
- remeasurement of defined
benefit asset/liability
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(200)
|
(200)
|
(2)
|
(202)
|
- share of other comprehensive
income of associates and joint ventures
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(54)
|
(54)
|
-
|
(54)
|
- effects of
hyperinflation
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
1,026
|
1,026
|
-
|
1,026
|
- insurance finance income/
(expense) recognised in other comprehensive income
|
-
|
-
|
-
|
-
|
-
|
-
|
(263)
|
-
|
(263)
|
-
|
(263)
|
- other exchange
differences
|
-
|
-
|
(79)
|
111
|
60
|
-
|
(7)
|
-
|
85
|
58
|
143
|
Total comprehensive income for the
period
|
-
|
-
|
1,842
|
4,107
|
60
|
-
|
(270)
|
6,231
|
11,970
|
540
|
12,510
|
Shares issued under employee
remuneration and share plans
|
1
|
-
|
-
|
-
|
-
|
-
|
-
|
(1)
|
-
|
-
|
-
|
Dividends to shareholders
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(4,460)
|
(4,460)
|
(228)
|
(4,688)
|
Redemption of securities
|
-
|
(1,673)
|
-
|
-
|
-
|
-
|
-
|
20
|
(1,653)
|
-
|
(1,653)
|
Cost of share-based payment
arrangements
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
254
|
254
|
-
|
254
|
Transfers
|
-
|
-
|
-
|
-
|
-
|
(5,130)
|
-
|
5,130
|
-
|
-
|
-
|
Share buy-backs
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(5,018)
|
(5,018)
|
-
|
(5,018)
|
Cancellation of shares
|
(442)
|
-
|
-
|
-
|
-
|
442
|
-
|
-
|
-
|
-
|
-
|
Other movements
|
-
|
-
|
1,123
|
(255)
|
(967)
|
(1)
|
77
|
89
|
66
|
(512)
|
(446)
|
At 31 Dec 2023
|
24,369
|
17,719
|
(3,507)
|
(1,033)
|
(33,753)
|
28,601
|
785
|
152,148
|
185,329
|
7,281
|
192,610
|
1 The insurance
finance reserve reflects the impact of adoption of the other
comprehensive income option for our insurance business in France.
Underlying assets supporting these contracts are measured at fair
value through other comprehensive income. Under this option, only
the amount that matches income or expenses recognised in profit or
loss on underlying items is included in finance income or expenses,
resulting in the elimination of income statement accounting
mismatches. The remaining amount of finance income or expenses for
these insurance contracts is recognised in other comprehensive
income ('OCI').
2 In June 2024,
HSBC Holdings issued SGD1,500m of contingent convertible securities
on which there were SGD15m of external issue costs.
3 At 30 June 2024,
an impairment of $2,945m of HSBC Overseas Holdings (UK) Limited was
recognised post sale of our banking business in Canada, resulting
in a permitted transfer from the merger reserve to retained
earnings.
4 In February 2024,
HSBC Holdings announced a share buy-back of up to $2.0bn, which
concluded in March 2024. Additionally, in April 2024, HSBC Holdings
announced another share buy-back of up to $3.0bn, which was
completed in July 2024.
Consolidated statement of cash
flows
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
$m
|
Profit before tax
|
21,556
|
21,657
|
Adjustments for non-cash items:
|
|
|
Depreciation, amortisation and
impairment
|
1,969
|
1,591
|
Net gain from investing
activities
|
(34)
|
(41)
|
Share of profit in associates and
joint ventures
|
(1,626)
|
(1,583)
|
Net gain on acquisition/disposal of
subsidiaries, businesses, associates and joint ventures
|
(3,199)
|
(3,604)
|
Change in expected credit losses
gross of recoveries and other credit impairment charges
|
1,192
|
1,482
|
Provisions including
pensions
|
15
|
148
|
Share-based payment
expense
|
274
|
228
|
Other non-cash items included in
profit before tax
|
(4,237)
|
(1,661)
|
Elimination of exchange
differences1
|
18,406
|
(6,558)
|
Change in operating
assets2
|
(41,493)
|
(52,745)
|
Change in operating
liabilities
|
36,486
|
72,836
|
Dividends received from
associates
|
130
|
124
|
Contributions paid to defined benefit
plans
|
(76)
|
(87)
|
Tax paid
|
(2,664)
|
(1,664)
|
Net
cash from operating activities
|
26,699
|
30,123
|
Purchase of financial
investments
|
(259,999)
|
(298,182)
|
Proceeds from the sale and maturity
of financial investments
|
223,443
|
263,838
|
Net cash flows from the purchase and
sale of property, plant and equipment
|
(464)
|
(329)
|
Net investment in intangible
assets
|
(1,058)
|
(1,123)
|
Net cash inflow on
acquisition/disposal of subsidiaries, businesses, associates and
joint ventures3
|
9,891
|
1,243
|
Net cash outflow on
acquisition/disposal of subsidiaries, businesses, associates and
joint ventures3
|
(10,612)
|
(15)
|
Net
cash from investing activities
|
(38,799)
|
(34,568)
|
Issue of ordinary share capital and
other equity instruments
|
1,106
|
1,996
|
Cancellation of shares
|
(5,330)
|
(1,273)
|
Net sales/(purchases) of own shares
for market-making and investment purposes
|
(494)
|
(823)
|
Redemption of preference shares and
other equity instruments
|
-
|
(2,350)
|
Subordinated loan capital
issued
|
2,611
|
2,744
|
Subordinated loan capital
repaid
|
(2,000)
|
(1,044)
|
Dividends paid to shareholders of the
parent company and non-controlling interests
|
(12,685)
|
(7,508)
|
Net
cash from financing activities
|
(16,792)
|
(8,258)
|
Net
decrease in cash and cash equivalents
|
(28,892)
|
(12,703)
|
Cash and cash equivalents at the
beginning of the period
|
490,933
|
521,671
|
Exchange differences in respect of
cash and cash equivalents
|
(13,057)
|
8,565
|
Cash
and cash equivalents at the end of the
period4
|
448,984
|
517,533
|
Interest received was $54,197m (1H23:
$46,817m), interest paid was $41,254m (1H23: $29,222m) and
dividends received (excluding dividends received from associates,
which are presented separately above) were $1,231m (1H23:
$751m).
1 Adjustments
to bring changes between opening and closing balance sheet amounts
to average rates. This is not done on a line-by-line basis, as
details cannot be determined without unreasonable
expense.
2 Includes
net settlement of the foreign exchange hedge of the proceeds from
the sale of our banking business in Canada, with a $255m gain in
1H24 (1H23: $284m loss).
3 The 'Net
cash inflow on acquisition/disposal of subsidiaries, businesses,
associates and joint ventures' includes $9.3bn of net cash
inflow on the sale of our banking business in Canada in March 2024.
In 1H23, it included $1.2bn of net cash inflow on acquisition of
Silicon Valley Bank UK Limited in March 2023. The 'Net cash outflow
on acquisition/disposal of subsidiaries, businesses, associates and
joint ventures includes $10.6bn of net cash outflow on the sale of
our retail banking operations in France in January 2024.
4 Includes
$1.7bn (1H23: $7.5bn) of cash and cash equivalents classified as
held for sale.
1
|
Basis of preparation and material
accounting policies
|
(a) Compliance with
International Financial Reporting Standards
Our interim condensed consolidated
financial statements have been prepared on the basis of the
policies set out in the 2023 annual financial statements. They have
also been prepared in accordance with IAS 34 'Interim Financial
Reporting' as adopted by the UK, IAS 34 'Interim Financial
Reporting' as issued by the International Accounting Standards
Board ('IASB'), IAS 34 'Interim Financial Reporting' as adopted by
the EU, and the Disclosure Guidance and Transparency Rules
sourcebook of the UK's Financial Conduct Authority. Therefore, they
include an explanation of events and transactions that are
significant to an understanding of the changes in HSBC's financial
position and performance since the end of 2023.
The interim condensed consolidated
financial statements should be read in conjunction with the Annual
Report and Accounts 2023, which was prepared in accordance with
UK-adopted international accounting standards in conformity with
the requirements of the Companies Act 2006 and international
financial reporting standards adopted pursuant to Regulation (EC)
No 1606/2002 as it applies in the European Union. The interim
condensed consolidated financial statements were also prepared in
accordance with International Financial Reporting Standards ('IFRS
Accounting Standards') as issued by the IASB, including
interpretations issued by the IFRS Interpretations
Committee.
At 30 June 2024, there were no IFRS
Accounting Standards effective for the half-year to 30 June 2024
affecting these financial statements that were not approved for
adoption in the UK by the UK Endorsement Board. There was no
difference between IFRS Accounting Standards adopted by the UK,
IFRS Accounting Standards as adopted by the EU, and IFRS Accounting
Standards issued by the IASB in terms of their application to
HSBC.
Standards applied during the half-year to 30 June
2024
There were no new standards or
amendments to standards that had an effect on the interim condensed
consolidated financial statements.
(b) Use of estimates and
judgements
Management believes that the critical
estimates and judgements applicable to the Group are those that
relate to impairment of amortised cost and FVOCI debt financial
assets, the valuation of financial instruments, deferred tax
assets, provisions, interests in associates, impairment of goodwill
and non-financial assets, and post-employment benefit
plans.
Other than in respect of non-current
assets and disposal groups held for sale, there were no material
changes in the current period to any of the critical estimates and
judgements disclosed in 2023, which are stated on pages 101 and 343
to 354 of the Annual Report and Accounts 2023.
(c) Composition of the
Group
In the first half of 2024 the sales
of the retail banking operations in France, the banking business in
Canada, and the business in Russia completed.
There were no other material changes
in the composition of the Group in the half-year to 30 June
2024.
For further details of future
business acquisitions and disposals, see Note 15 'Assets held for
sale, liabilities of disposal groups held for sale and business
acquisitions' in the Interim Report 2024.
(d) Future accounting
developments
Amendments to IAS 21 'Lack of
Exchangeability'
In August 2023, the IASB published
amendments to IAS 21 'Lack of Exchangeability' effective from 1
January 2025. The Group is undertaking an assessment of the
potential impact, which is not expected to be
significant.
Amendments to IFRS 9 'Financial Instruments' and IFRS 7
'Financial Instruments: Disclosures'
In May 2024, the IASB issued
amendments to IFRS 9 'Financial Instruments' and IFRS 7 'Financial
Instruments: Disclosures', effective for annual reporting periods
beginning on, or after, 1 January 2026. In addition to guidance as
to when certain financial liabilities can be deemed settled when
using an electronic payment system, the amendments also provide
further clarification regarding the classification of financial
assets that contain contractual terms that change the timing or
amount of contractual cash flows, including those arising from
ESG-related contingencies, and financial assets with certain
non-recourse features. The Group is undertaking an assessment of
the potential impact.
IFRS
18 'Presentation and Disclosure in Financial
Statements'
In April 2024, the IASB issued IFRS
18 'Presentation and Disclosure in Financial Statements', effective
for annual reporting periods beginning on or after 1 January 2027.
The new accounting standard aims to give users of financial
statements more transparent and comparable information about an
entity's financial performance. It will replace IAS 1 'Presentation
of Financial Statements' but carries over many requirements from
that IFRS Accounting Standard unchanged. In addition, there are
three sets of new requirements relating to the structure of the
income statement, management-defined performance measures and the
aggregation and disaggregation of financial information.
While IFRS 18 will not change
recognition criteria or measurement bases, it might have a
significant impact on presenting information in the financial
statements, in particular the income statement. HSBC are currently
assessing any impacts as well as data readiness before developing a
more detailed implementation plan.
(e) Going concern
The financial statements are prepared
on a going concern basis, as the Directors are satisfied that the
Group and parent company have the resources to continue in business
for the foreseeable future. In making this assessment, the
Directors have considered a wide range of information relating to
present and future conditions, including future projections of
profitability, cash flows, capital requirements and capital
resources. These considerations include stressed scenarios, as well
as considering potential impacts from other top and emerging risks,
and the related impact on profitability, capital and
liquidity.
(f) Accounting
policies
The accounting policies that we
applied for the interim condensed consolidated financial statements
are consistent with those described on pages 341 to 354 of the
Annual Report and Accounts 2023, as are the methods of
computation.
On 31 July 2024, the Directors
approved a second interim dividend for 2024 of $0.10 per ordinary
share in respect of the financial year ending 31 December
2024. This distribution amounts to approximately $1.849bn and will
be payable on 27 September 2024. No liability is recognised in
the financial statements in respect of these dividends.
Dividends paid to shareholders of
HSBC Holdings plc
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
Per share
|
Total
|
Per
share
|
Total
|
|
$
|
$m
|
$
|
$m
|
Dividends paid on ordinary shares
|
|
|
|
|
In respect of previous
year:
|
|
|
|
|
- second interim
dividend
|
-
|
-
|
0.23
|
4,590
|
- fourth interim
dividend
|
0.31
|
5,872
|
-
|
-
|
In respect of current
year:
|
|
|
|
|
- first interim
dividend
|
0.10
|
1,877
|
0.10
|
2,001
|
- special dividend
|
0.21
|
3,942
|
-
|
-
|
Total
|
0.62
|
11,691
|
0.33
|
6,591
|
Total coupons on capital securities
classified as equity
|
|
526
|
|
542
|
Dividends to shareholders
|
|
12,217
|
|
7,133
|
Second interim dividend for
2024
On 31 July 2024, the Directors
approved a second interim dividend in respect of the financial year
ending 31 December 2024 of $0.10 per ordinary share (the
'dividend'), a distribution of approximately $1.849bn. The dividend
will be payable on 27 September 2024 to holders of record on the
Principal Register in the UK, the Hong Kong Overseas Branch
Register or the Bermuda Overseas Branch Register on 16 August
2024.
The dividend will be payable in US
dollars, or in pounds sterling or Hong Kong dollars at the forward
exchange rates quoted by HSBC Bank plc in London at or about
11.00am on 16 September 2024. The ordinary shares in London, Hong
Kong and Bermuda will be quoted ex-dividend on 15 August 2024.
American Depositary Shares ('ADSs') in New York will be quoted
ex-dividend on 16 August 2024.
The default currency on the Principal
Register in the UK is pounds sterling, and dividends can also be
paid in Hong Kong dollars or US dollars, or a combination of these
currencies. International shareholders can register to join the
Global Dividend Service to receive dividends in their local
currencies. Please register and read the terms and conditions at
www.investorcentre.co.uk. UK shareholders can also register their
sterling bank mandates at www.investorcentre.co.uk.
The default currency on the Hong Kong
Overseas Branch Register is Hong Kong dollars, and dividends can
also be paid in US dollars or pounds sterling, or a combination of
these currencies. Shareholders can arrange for direct credit of
Hong Kong dollar cash dividends into their bank account, or arrange
to send US dollar or pound sterling cheques to the credit of their
bank account. Shareholders can register for these services at
www.investorcentre.com/hk. Shareholders can also download a
dividend currency election form from www.hsbc.com/dividends,
www.investorcentre.com/hk, or www.hkexnews.hk.
The default currency on the Bermuda
Overseas Branch Register is US dollars, and dividends can also be
paid in Hong Kong dollars or pounds sterling, or a combination of
these currencies. Shareholders can change their dividend currency
election by contacting the Bermuda investor relations team.
Shareholders can download a dividend currency election form from
www.hsbc.com/dividends.
Changes to currency elections must be
received by 12 September 2024 to be effective for this
dividend.
The dividend will be payable on ADSs,
each of which represents five ordinary shares, on 27 September 2024
to holders of record on 16 August 2024. The dividend of
$0.50 per ADS will be payable by the depositary in US dollars.
Alternatively, the cash dividend may be invested in additional ADSs
by participants in the dividend reinvestment plan operated by the
depositary. Elections must be received by
6 September 2024.
Any person who has acquired ordinary
shares registered on the Principal Register in the UK, the Hong
Kong Overseas Branch Register or the Bermuda Overseas Branch
Register but who has not lodged the share transfer with the
Principal Registrar in the UK, Hong Kong Overseas Branch Registrar
or Bermuda Overseas Branch Registrar should do so before 4.00pm
local time on 16 August 2024 in order to receive the
dividend.
Ordinary shares may not be removed
from or transferred to the Principal Register in the UK, the Hong
Kong Overseas Branch Register or the Bermuda Overseas Branch
Register on 16 August 2024. Any person wishing to remove ordinary
shares to or from each register must do so before 4.00pm local time
on 15 August 2024.
Transfer of ADSs must be lodged with
the depositary by 11.00am on 16 August 2024 in order to receive the
dividend. ADS holders who receive a cash dividend will be charged a
fee, which will be deducted by the depositary, of $0.005 per ADS
per cash dividend.
Dividend on preference
share
A quarterly dividend of £0.01 per
Series A sterling preference share is payable on 15 March, 17 June,
16 September and 16 December 2024 for the quarter then ended
at the sole and absolute discretion of the Board of HSBC Holdings
plc. Accordingly, the Board of HSBC Holdings plc has approved a
quarterly dividend to be payable on 16 September 2024 to holders of
record on 30 August 2024.
Basic earnings per ordinary share is
calculated by dividing the profit attributable to ordinary
shareholders of the parent company by the weighted average number
of ordinary shares outstanding, excluding own shares held. Diluted
earnings per ordinary share is calculated by dividing the basic
earnings, which require no adjustment for the effects of dilutive
potential ordinary shares, by the weighted average number of
ordinary shares outstanding, excluding own shares held, plus the
weighted average number of ordinary shares that would be issued on
conversion of dilutive potential ordinary shares.
Basic and diluted earnings per
share
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
Profit
|
Number
of shares
|
Amount per
share
|
Profit
|
Number
of
shares
|
Amount per
share
|
|
$m
|
(millions)
|
$
|
$m
|
(millions)
|
$
|
Basic1
|
16,586
|
18,666
|
0.89
|
16,966
|
19,693
|
0.86
|
Effect of dilutive potential ordinary
shares
|
|
120
|
|
|
136
|
|
Diluted1
|
16,586
|
18,786
|
0.88
|
16,966
|
19,829
|
0.86
|
1 Weighted
average number of ordinary shares outstanding (basic) or assuming
dilution (diluted).
4
|
Constant currency balance sheet
reconciliation
|
|
At 30 Jun
2024
|
At 30
June 2023
|
At 31 Dec
2023
|
|
Reported and constant
currency
|
Constant
currency
|
Currency
translation
|
Reported
|
Constant
currency
|
Currency
translation
|
Reported
|
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
Loans and advances to customers
(net)
|
938,257
|
951,014
|
(8,544)
|
959,558
|
925,791
|
(12,744)
|
938,535
|
Interests in associates and joint
ventures
|
28,465
|
29,534
|
(12)
|
29,546
|
26,967
|
(377)
|
27,344
|
Total external assets
|
2,975,003
|
3,011,721
|
(29,755)
|
3,041,476
|
2,997,845
|
(40,832)
|
3,038,677
|
Customer accounts
Customer accounts
|
1,593,834
|
1,580,418
|
(15,351)
|
1,595,769
|
1,590,533
|
(21,114)
|
1,611,647
|
5
|
Reported and constant currency
results1
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
$m
|
Revenue2
|
|
|
Reported
|
37,292
|
36,876
|
Currency translation
|
|
(374)
|
Constant currency
|
37,292
|
36,502
|
Change in expected credit losses and other credit impairment
charges
|
|
|
Reported
|
(1,066)
|
(1,345)
|
Currency translation
|
|
28
|
Constant currency
|
(1,066)
|
(1,317)
|
Operating expenses
|
|
|
Reported
|
(16,296)
|
(15,457)
|
Currency translation
|
|
213
|
Constant currency
|
(16,296)
|
(15,244)
|
Share of profit in associates and joint
ventures
|
|
|
Reported
|
1,626
|
1,583
|
Currency translation
|
|
(52)
|
Constant currency
|
1,626
|
1,531
|
Profit before tax
|
|
|
Reported
|
21,556
|
21,657
|
Currency translation
|
|
(185)
|
Constant currency
|
21,556
|
21,472
|
Profit after tax
|
|
|
Reported
|
17,665
|
18,071
|
Currency translation
|
|
(113)
|
Constant currency
|
17,665
|
17,958
|
1 In the
current period constant currency results are equal to reported as
there is no currency translation.
2 Net
operating income before change in expected credit losses and other
credit impairment charges, also referred to as revenue.
Notable items
|
|
Half-year
to
|
|
30 Jun 2024
|
30 Jun
2023
|
|
$m
|
$m
|
Revenue
|
|
|
Disposals, acquisitions and related
costs1,2
|
3,571
|
3,321
|
Fair value movements on financial
instruments3
|
-
|
15
|
Operating expenses
|
|
|
Disposals, acquisitions and related
costs
|
(101)
|
(118)
|
Restructuring and other related
costs4
|
19
|
47
|
Tax
|
|
|
Tax (charge)/credit on notable
items
|
14
|
(500)
|
Recognition of losses
|
-
|
-
|
Uncertain tax positions
|
-
|
427
|
1 Includes a
$4.8bn gain on disposal of our banking business in Canada,
inclusive of a $0.3bn gain on the foreign exchange hedging of the
sales proceeds, the recycling of $0.6bn in foreign currency
translation reserve losses and $0.4bn of other reserves recycling
losses. This is partly offset by a $1.2bn impairment recognised in
relation to the planned sale of our business in
Argentina.
2 In the
first quarter of 2023, the $2.1bn reversal of the held for sale
classification was recognised relating to the sale of our retail
banking operations in France and a gain of $1.5bn was recognised in
respect of the acquisition of SVB UK.
3 Fair value
movements on non-qualifying hedges in HSBC Holdings.
4 Relates to
reversals of restructuring provisions recognised during
2022.
6
|
Contingent liabilities, contractual
commitments and guarantees
|
|
At
|
|
30 Jun 2024
|
31 Dec
2023
|
|
$m
|
$m
|
Guarantees and other contingent liabilities:
|
|
|
- financial
guarantees
|
16,343
|
17,009
|
- performance and other
guarantees
|
91,275
|
94,277
|
- other contingent
liabilities
|
543
|
636
|
At
the end of the period
|
108,161
|
111,922
|
Commitments:1
|
|
|
- documentary credits and
short-term trade-related transactions
|
7,169
|
7,818
|
- forward asset purchases and
forward deposits placed
|
87,219
|
78,535
|
- standby facilities, credit
lines and other commitments to lend
|
780,929
|
810,797
|
At
the end of the period
|
875,317
|
897,150
|
1 Includes
$638,635m of commitments at 30 June 2024 (31 December 2023:
$661,015m), to which the impairment requirements in IFRS 9 are
applied where HSBC has become party to an irrevocable
commitment.
Contingent liabilities arising from
legal proceedings and regulatory and other matters against Group
companies are excluded from this note but are disclosed in Note 7
below and Notes 11 and 13 of the Interim Report 2024.
7
|
Legal proceedings and regulatory
matters
|
HSBC is party to legal proceedings
and regulatory matters in a number of jurisdictions arising out of
its normal business operations. Apart from the matters described
below, HSBC considers that none of these matters are material. The
recognition of provisions is determined in accordance with the
accounting policies set out in Note 1 of the Annual Report and
Accounts 2023. While the outcomes of legal proceedings and
regulatory matters are inherently uncertain, management believes
that, based on the information available to it, appropriate
provisions have been made in respect of these matters as at 30 June
2024 (see Note 11 of the Interim Report 2024). Where an individual
provision is material, the fact that a provision has been made is
stated and quantified, except to the extent that doing so would be
seriously prejudicial. Any provision recognised does not constitute
an admission of wrongdoing or legal liability. It is not
practicable to provide an aggregate estimate of potential
liability for our legal proceedings and regulatory matters as a
class of contingent liabilities.
Bernard L. Madoff Investment
Securities LLC
Various non-US HSBC companies
provided custodial, administration and similar services to a number
of funds incorporated outside the US whose assets were invested
with Bernard L. Madoff Investment Securities LLC ('Madoff
Securities'). Based on information provided by Madoff Securities as
at 30 November 2008, the purported aggregate value of these funds
was $8.4bn, including fictitious profits reported by Madoff. Based
on information available to HSBC, the funds' actual transfers to
Madoff Securities minus their actual withdrawals from Madoff
Securities during the time HSBC serviced the funds are estimated to
have totalled approximately $4bn. Various HSBC companies have been
named as defendants in lawsuits arising out of Madoff Securities'
fraud.
US
litigation: The Madoff Securities
Trustee has brought lawsuits against various HSBC companies and
others, seeking recovery of alleged transfers from Madoff
Securities to HSBC in the amount of $543m (plus interest), and
these lawsuits remain pending in the US Bankruptcy Court for the
Southern District of New York (the 'US Bankruptcy
Court').
Certain Fairfield entities (together,
'Fairfield') (in liquidation) have brought a lawsuit in the US
against fund shareholders, including HSBC companies that acted as
nominees for clients, seeking restitution of redemption payments in
the amount of $382m (plus interest). Fairfield's claims against
most of the HSBC companies have been dismissed by the US Bankruptcy
Court and the US District Court for the Southern District of New
York, but remain pending on appeal before the US Court of Appeals
for the Second Circuit. Fairfield's claims against HSBC Private
Bank (Suisse) SA and HSBC Securities Services Luxembourg ('HSSL')
have not been dismissed and their appeals are also pending before
the US Court of Appeals for the Second Circuit. Meanwhile,
proceedings before the US Bankruptcy Court with respect to the
claims against HSBC Private Bank (Suisse) SA and HSSL are
ongoing.
UK
litigation: The Madoff Securities
Trustee has filed a claim against various HSBC companies in the
High Court of England and Wales, seeking recovery of transfers from
Madoff Securities to HSBC. The claim has not yet been served and
the amount claimed has not been specified.
Luxembourg litigation: In 2009,
Herald Fund SPC ('Herald') (in liquidation) brought an action
against HSSL before the Luxembourg District Court, seeking
restitution of cash and securities in the amount of $2.5bn (plus
interest), or damages in the amount of $2bn (plus interest). In
2018, HSBC Bank plc was added to the claim and Herald increased the
amount of the alleged damages claim to $5.6bn (plus interest). The
Luxembourg District Court has dismissed Herald's securities
restitution claim, but reserved Herald's cash restitution and
damages claims. Herald has appealed this dismissal to the
Luxembourg Court of Appeal, where the matter is pending.
Beginning in 2009, various HSBC
companies have been named as defendants in a number of actions
brought by Alpha Prime Fund Limited in the Luxembourg District
Court seeking damages for alleged breach of contract and negligence
in the amount of $1.16bn (plus interest). These matters are
currently pending before the Luxembourg District Court.
Beginning in 2014, HSSL and the
Luxembourg branch of HSBC Bank plc have been named as defendants in
a number of actions brought by Senator Fund SPC before the
Luxembourg District Court seeking restitution of securities in the
amount of $625m (plus interest), or damages in the amount of $188m
(plus interest). These matters are currently pending before the
Luxembourg District Court.
Based on the facts currently known,
it is not practicable at this time for HSBC to predict the
resolution of the pending matters, including the timing or any
possible impact on HSBC, which could be significant.
US Anti-Terrorism Act
litigation
Since November 2014, a number of
lawsuits have been filed in federal courts in the US against
various HSBC companies and others on behalf of plaintiffs who are,
or are related to, alleged victims of terrorist attacks in the
Middle East. In each case, it is alleged that the defendants aided
and abetted the unlawful conduct of various sanctioned parties in
violation of the US Anti-Terrorism Act, or provided banking
services to customers alleged to have connections to terrorism
financing. Seven actions, which seek damages for unspecified
amounts, remain pending and HSBC's motions to dismiss have been
granted in three of these cases. These dismissals are subject to
appeals and/or the plaintiffs re-pleading their claims. The four
other actions are at an early stage.
Based on the facts currently known,
it is not practicable at this time for HSBC to predict the
resolution of these matters, including the timing or any possible
impact on HSBC, which could be significant.
Interbank offered rates investigation
and litigation
Euro
interest rate derivatives: In
December 2016, the European Commission ('EC') issued a decision
finding that HSBC, among other banks, engaged in anti-competitive
practices in connection with the pricing of euro interest rate
derivatives, and the EC imposed a fine on HSBC based on a one-month
infringement in 2007. The fine was annulled in 2019 and a lower
fine was imposed in 2021. In January 2023, the European Court of
Justice dismissed an appeal by HSBC and upheld the EC's findings on
HSBC's liability. A separate appeal by HSBC concerning the amount
of the fine remains pending before the General Court of the
European Union.
US
dollar Libor: Beginning in 2011,
HSBC and other panel banks have been named as defendants in a
number of individual and putative class action lawsuits filed in
federal and state courts in the US with respect to the setting of
US dollar Libor. The complaints assert claims under various US
federal and state laws, including antitrust and racketeering laws
and the Commodity Exchange Act ('US CEA'). HSBC has concluded class
settlements with five groups of plaintiffs, and several class
action lawsuits brought by other groups of plaintiffs have been
voluntarily dismissed. A number of individual US dollar
Libor-related actions seeking damages for unspecified amounts
remain pending.
Based on the facts currently known,
it is not practicable at this time for HSBC to predict the
resolution of the pending matters, including the timing or any
possible impact on HSBC, which could be significant.
Foreign exchange-related
investigations and litigation
In December 2016, Brazil's
Administrative Council of Economic Defense initiated an
investigation into the onshore foreign exchange market and
identified a number of banks, including HSBC, as subjects of its
investigation, which remains ongoing.
Since 2017, HSBC Bank plc, among
other financial institutions, has been defending a complaint filed
by the Competition Commission of South Africa before the South
African Competition Tribunal for alleged anti-competitive behaviour
in the South African foreign exchange market. In 2020, a revised
complaint was filed which also named HSBC Bank USA N.A. ('HSBC Bank
USA') as a defendant. In January 2024, the South African
Competition Appeal Court dismissed HSBC Bank USA from the revised
complaint but denied HSBC Bank plc's application to dismiss. The
Competition Commission and HSBC Bank plc have appealed to the
Constitutional Court of South Africa.
Since 2015, various HSBC companies
and other banks have been named as defendants in a putative class
action in the US District Court for the Southern District of New
York filed by a group of retail customers who dealt in foreign
exchange products. The plaintiffs allege that the defendants
conspired to manipulate foreign exchange rates and seek damages for
unspecified amounts. In May 2024, the US Court of Appeals for the
Second Circuit affirmed the dismissal of this action.
HSBC Bank plc and HSBC Holdings have
reached a settlement with plaintiffs in Israel to resolve a class
action filed in the local courts alleging foreign exchange-related
misconduct. The settlement remains subject to court approval.
Lawsuits alleging foreign exchange-related misconduct remain
pending against HSBC and other banks in courts in
Brazil.
In February 2024, HSBC Bank plc and
HSBC Holdings were joined to an existing claim brought in the UK
Competition Appeals Tribunal against various other banks alleging
historical anti-competitive behaviour in the foreign exchange
market and seeking approximately £3bn in damages from all the
defendants. This matter is at an early stage. It is possible that
additional civil actions will be initiated against HSBC in relation
to its historical foreign exchange activities.
There are many factors that may
affect the range of outcomes, and the resulting financial impact,
of the pending matters, which could be significant.
Precious metals fix-related
litigation
US
litigation: HSBC and other members
of The London Silver Market Fixing Limited are defending a class
action pending in the US District Court for the Southern District
of New York alleging that, from January 2007 to December 2013, the
defendants conspired to manipulate the price of silver and silver
derivatives for their collective benefit in violation of US
antitrust laws, the US CEA and New York state law. In May 2023,
this action, which seeks damages for unspecified amounts, was
dismissed but remains pending on appeal.
HSBC and other members of The London
Platinum and Palladium Fixing Company Limited are defending a class
action pending in the US District Court for the Southern District
of New York alleging that, from January 2008 to November 2014, the
defendants conspired to manipulate the price of platinum group
metals and related financial products for their collective benefit
in violation of US antitrust laws and the US CEA. The defendants
have reached a settlement-in-principle with the plaintiffs to
resolve this action. The settlement-in-principle remains subject to
documentation and court approval.
Canada litigation: HSBC and
other financial institutions are defending putative class actions
filed in the Ontario and Quebec Superior Courts of Justice alleging
that the defendants conspired to manipulate the price of silver,
gold and related derivatives in violation of the Canadian
Competition Act and common law. These actions each seek CA$1bn in
damages plus CA$250m in punitive damages. Two of the actions are
proceeding and the others have been stayed.
There are many factors that may
affect the range of outcomes, and the resulting financial impact,
of the pending matters, which could be significant.
Tax-related investigations
In March 2023, the French National
Financial Prosecutor announced an investigation into a number of
banks, including HSBC Continental Europe and the Paris branch of
HSBC Bank plc, in connection with alleged tax fraud related to the
dividend withholding tax treatment of certain trading activities.
HSBC Bank plc and the German branch of HSBC Continental Europe also
continue to cooperate with investigations by the German public
prosecutor into numerous financial institutions and their
employees, in connection with the dividend withholding tax
treatment of certain trading activities.
Based on the facts currently known,
it is not practicable at this time for HSBC to predict the
resolution of these matters, including the timing or any possible
impact on HSBC, which could be significant.
Gilts trading investigation and
litigation
Since 2018, the UK Competition and
Markets Authority ('CMA') has been investigating HSBC and four
other banks for suspected anti-competitive conduct in relation to
the historical trading of gilts and related derivatives. In May
2023, the CMA announced its case against HSBC Bank plc and HSBC
Holdings; both HSBC companies are contesting the CMA's
allegations.
In June 2023, HSBC Bank plc and HSBC
Securities (USA) Inc., among other banks, were named as defendants
in a putative class action filed in the US District Court for the
Southern District of New York by plaintiffs alleging
anti-competitive conduct in the gilts market and seeking damages
for unspecified amounts. In September 2023, the defendants filed a
motion to dismiss which remains pending. It is possible that
additional civil actions will be initiated against HSBC in relation
to its historical gilts trading activities.
Based on the facts currently known,
it is not practicable at this time for HSBC to predict the
resolution of these matters, including the timing or any possible
impact on HSBC, which could be significant.
UK collections and recoveries
investigation
In 2019, the FCA began investigating
HSBC Bank plc's, HSBC UK Bank plc's and Marks and Spencer Financial
Services plc's compliance with regulatory standards relating to
collections and recoveries operations in the UK between 2017 and
2018. In May 2024, the FCA concluded its investigation and imposed
a £6m fine on HSBC Bank plc, HSBC UK Bank plc and Marks and Spencer
Financial Services plc, which has been paid, and this matter is now
closed.
Korean short selling
indictment
In March 2024, the Korean
Prosecutors' Office issued a criminal indictment against The
Hongkong and Shanghai Banking Corporation Limited and three current
and former employees for breaching short selling rules under the
Financial Investment Services and Capital Markets Act in connection
with trades carried out between August 2021 and December 2021. The
Hongkong and Shanghai Banking Corporation Limited is defending the
action.
Silicon Valley Bank ('SVB')
litigation
In May 2023, First-Citizens Bank
& Trust Company ('First Citizens') brought a lawsuit in the US
District Court for the Northern District of California against
various HSBC companies and seven US-based HSBC employees who had
previously worked for SVB. The lawsuit seeks $1bn in damages and
alleges, among other things, that the various HSBC companies
conspired with the individual defendants to solicit employees from
First Citizens and that the individual defendants took confidential
information belonging to SVB and/or First Citizens. In July 2024,
the court dismissed several of First Citizens' claims and also
dismissed certain defendants for lack of jurisdiction, but allowed
limited discovery into whether some of these defendants may be
subject to jurisdiction. The remaining claims are proceeding
against certain defendants.
Based on the facts currently known,
it is not practicable at this time for HSBC to predict the
resolution of this matter, including the timing or any possible
impact on HSBC, which could be significant.
Film Finance litigation
In June 2020, two separate investor
groups issued claims against HSBC UK Bank plc (as successor to HSBC
Private Bank (UK) Limited ('PBGB')) in the High Court of England
and Wales seeking damages for unspecified amounts in connection
with PBGB's role in the development of Eclipse film finance
schemes. In March 2024, HSBC UK Bank plc reached a settlement with
the first investor group. In April 2024, the High Court dismissed
the second investor group's claims, and this matter is now
closed.
US mortgage securitisation
litigation
Beginning in 2014, a number of
lawsuits were filed in various state and federal courts in the US
against HSBC Bank USA, as a trustee of more than 280 mortgage
securitisation trusts, seeking unspecified damages for losses in
collateral value allegedly sustained by the trusts. HSBC Bank USA
has reached settlements with a number of plaintiffs to resolve
nearly all of these lawsuits. The remaining two actions are pending
in a New York state court. HSBC Bank USA and certain of its
affiliates continue to defend a mortgage loan repurchase action
seeking unspecified damages and specific performance brought by the
trustee of a mortgage securitisation trust in New York state
court.
There are many factors that may
affect the range of outcomes, and the resulting financial impact,
of the pending matters, which could be
significant.
Mexican government bond
litigation
HSBC Mexico S.A. and other banks are
named as defendants in a consolidated putative class action pending
in the US District Court for the Southern District of New York
alleging anti-competitive conduct in the Mexican government bond
market between 2010 and 2014 and seeking damages for unspecified
amounts. In February 2024, the US Court of Appeals for the Second
Circuit reversed an earlier dismissal of this lawsuit. In May 2024,
the plaintiffs amended their complaint and this action is
ongoing.
Based on the facts currently known,
it is not practicable at this time for HSBC to predict the
resolution of this matter, including the timing or any possible
impact on HSBC, which could be significant.
Stanford litigation
Since 2009, HSBC Bank plc has been
named as a defendant in numerous claims filed in courts in the UK
and the US arising from the collapse of Stanford International Bank
Ltd, for which it was a correspondent bank from 2003 to 2009. In
February 2023, HSBC Bank plc reached settlements with the
plaintiffs to resolve the claims and these settlements have
concluded.
Other regulatory investigations,
reviews and litigation
HSBC Holdings and/or certain of its
affiliates are also subject to a number of other enquiries and
examinations, requests for information, investigations and reviews
by various tax authorities, regulators, competition and law
enforcement authorities, as well as legal proceedings including
litigation, arbitration and other contentious proceedings, in
connection with various matters arising out of their businesses and
operations.
At the present time, HSBC does not
expect the ultimate resolution of any of these matters to be
material to the Group's financial position; however, given the
uncertainties involved in legal proceedings and regulatory matters,
there can be no assurance regarding the eventual outcome of a
particular matter or matters.
8
|
Events after the balance sheet
date
|
On 6 July 2024, the Hongkong and
Shanghai Banking Corporation Limited (acting through its Mauritius
Branch) completed the sale of its Wealth and Personal Banking
business to ABSA Bank (Mauritius) Limited, a wholly-owned
subsidiary of ABSA Bank Group Limited. The financial impact was not
significant for the Group.
A second interim dividend for 2024 of
$0.10 per ordinary share in respect of the financial year ending 31
December 2024 was approved by the Directors on 31 July 2024,
as described in Note 2. On 31 July 2024, HSBC Holdings announced a
share buy-back to purchase its ordinary shares up to a maximum
consideration of $3.0bn, which is expected to commence shortly and
complete within three months.
Capital ratios
|
|
|
|
At
|
|
30 Jun 2024
|
31 Dec
2023
|
|
%
|
%
|
Transitional basis
|
|
|
Common equity tier 1 ratio
|
15.0
|
14.8
|
Tier 1 ratio
|
17.3
|
16.9
|
Total capital ratio
|
20.6
|
20.0
|
End
point basis
|
|
|
Common equity tier 1 ratio
|
15.0
|
14.8
|
Tier 1 ratio
|
17.3
|
16.9
|
Total capital ratio
|
20.1
|
19.6
|
Total regulatory capital and
risk-weighted assets
|
|
|
|
At
|
|
30 Jun 2024
|
31 Dec
2023
|
|
$m
|
$m
|
Transitional basis
|
|
|
Common equity tier 1
capital
|
125,293
|
126,501
|
Additional tier 1 capital
|
18,965
|
17,662
|
Tier 2 capital
|
27,826
|
27,041
|
Total regulatory capital
|
172,084
|
171,204
|
Risk-weighted assets
|
835,118
|
854,114
|
End
point basis
|
|
|
Common equity tier 1
capital
|
125,293
|
126,501
|
Additional tier 1 capital
|
18,965
|
17,662
|
Tier 2 capital
|
23,886
|
22,894
|
Total regulatory capital
|
168,144
|
167,057
|
Risk-weighted assets
|
835,118
|
854,114
|
Leverage ratio1
|
|
|
|
At
|
|
30 Jun 2024
|
31 Dec
2023
|
|
$bn
|
$bn
|
Tier 1 capital (leverage)
|
144.3
|
144.2
|
Total leverage ratio
exposure
|
2,514.5
|
2,574.8
|
|
%
|
%
|
Leverage ratio
|
5.7
|
5.6
|
1 Leverage ratio
calculation is in line with the PRA's UK leverage rules. This
includes IFRS 9 transitional arrangement and excludes central bank
claims.
The information in this media release
is unaudited and does not constitute statutory accounts within the
meaning of section 434 of the Companies Act 2006. The statutory
accounts of HSBC Holdings plc for the year ended 31 December 2023
have been delivered to the Registrar of Companies in England and
Wales in accordance with section 447 of the Companies Act 2006. The
Group's auditor, PricewaterhouseCoopers LLP ('PwC') has reported on
those accounts. Its report was unqualified, did not include a
reference to any matters to which PwC drew attention by way of
emphasis without qualifying its report and did not contain a
statement under section 498(2) or (3) of the Companies Act
2006.
The information in this media release
does not constitute the unaudited interim condensed consolidated
financial statements which are contained in the Interim Report
2024. The Interim Report 2024 was approved by the Board of
Directors on 31 July 2024. The unaudited interim condensed
consolidated financial statements included in the Interim Report
2024 have been reviewed by the Group's auditor, PwC, in accordance
with International Standard on Review Engagements (UK) 2410,
'Review of Interim Financial Information Performed by the
Independent Auditor of the Entity' issued by the Financial
Reporting Council for use in the United Kingdom. The full report of
its review, which was unmodified, is included in the Interim Report
2024.
11
|
Dealings in HSBC Holdings listed
securities
|
HSBC has policies and procedures
that, except where permitted by statute and regulation, prohibit it
undertaking specified transactions in respect of its securities
listed on The Stock Exchange of Hong Kong Limited ('HKEx'). Except
for dealings as intermediaries or as trustees by subsidiaries of
HSBC Holdings, or in relation to HSBC Holdings ordinary share
buy-backs, neither HSBC Holdings nor any of its subsidiaries has
purchased, sold or redeemed any of its securities listed on HKEx
during the half-year ended 30 June 2024.
12
|
Earnings release and final
results
|
An earnings release for the
three-month period ending 30 September 2024 is expected to be
issued on 29 October 2024. The results for the year to 31 December
2024 are expected to be announced on 19 February 2025.
We are subject to corporate
governance requirements in both the UK and Hong Kong. Throughout
the six months ended 30 June 2024, we complied with the applicable
provisions of the UK Corporate Governance Code, and also the
requirements of the Hong Kong Corporate Governance Code. The UK
Corporate Governance Code is available at www.frc.org.uk and the
Hong Kong Corporate Governance Code is available at
www.hkex.com.hk. We note that the Financial Reporting Council have
issued a new UK Corporate Governance Code, which will apply to
financial reporting periods from 1 January 2025, and that The Stock
Exchange of Hong Kong Limited is currently consulting on changes to
the Hong Kong Corporate Governance Code. The Group will take the
necessary actions to ensure that we continue to be compliant with
both Codes as the new provisions come into force.
The Board has codified obligations
for transactions in Group securities in accordance with the
requirements of the UK Market Abuse Regulation and the rules
governing the listing of securities on the HKEx, save that the HKEx
has granted waivers from strict compliance with the rules that take
into account accepted practices in the UK, particularly in respect
of employee share plans.
All Directors have confirmed that
they have complied with their obligations in respect of transacting
in Group securities throughout the period.
There have been no material changes
to the information disclosed in the Annual Report and Accounts 2023
in respect of the remuneration of employees, remuneration policies,
bonus and share option plans and training schemes. Details of the
number of employees are provided on page 34 of the Interim
Report 2024.
The Board of Directors of HSBC
Holdings plc as at the date of this announcement
comprises:
Sir Mark Edward Tucker*, Noel Paul
Quinn, Geraldine Joyce Buckingham†, Rachel
Duan†, Georges Bahjat Elhedery, Dame Carolyn Julie
Fairbairn†, James Anthony Forese†, Ann
Frances Godbehere†, Steven Craig
Guggenheimer†, Dr José Antonio Meade
Kuribreña†, Kalpana Jaisingh Morparia†,
Eileen K Murray†, Brendan Robert Nelson† and
Swee Lian Teo†.
*
Non-executive Group Chairman
† Independent
non-executive Director
The Interim Report 2024 will be made
available to shareholders on or about 23 August 2024. Copies of the Interim Report 2024 and this
news release may be obtained from Global Communications, HSBC
Holdings plc, 8 Canada Square, London E14 5HQ, United Kingdom; from
Communications (Asia), The Hongkong and Shanghai Banking
Corporation Limited, 1 Queen's Road Central, Hong Kong; or from US
Communications, HSBC Bank USA, N.A., 1 West 39th Street, 9th Floor,
New York, NY 10018, USA. The Interim Report 2024 and this news
release may also be downloaded from the HSBC website,
www.hsbc.com.
A Chinese translation of the Interim
Report 2024 is available upon request from Computershare Hong Kong
Investor Services Limited, Rooms 1712-1716, 17th Floor, Hopewell
Centre, 183 Queen's Road East, Hong Kong.
The Interim Report 2024 will be
available on The Stock Exchange of Hong Kong Limited's website
www.hkex.com.hk.
15
|
Cautionary statement regarding
forward-looking statements
|
This news release may contain
projections, estimates, forecasts, targets, commitments, ambitions,
opinions, prospects, results, returns and forward-looking
statements with respect to the financial condition, results of
operations, capital position, ESG related matters, strategy and
business of the Group which can be identified by the use of
forward-looking terminology such as 'may', 'will', 'should',
'expect', 'anticipate', 'project', 'estimate', 'seek', 'intend',
'target', 'plan', 'believe', 'potential' or 'reasonably possible',
or the negatives thereof or other variations thereon or comparable
terminology (together, 'forward-looking statements'), including the
strategic priorities and any financial, investment and capital
targets and any ESG targets, commitments and ambitions described
herein.
Any such forward-looking statements
are not a reliable indicator of future performance, as they may
involve significant stated or implied assumptions and subjective
judgements which may or may not prove to be correct. There can be
no assurance that any of the matters set out in forward-looking
statements are attainable, will actually occur or will be realised
or are complete or accurate. The assumptions and judgements may
prove to be incorrect and involve known and unknown risks,
uncertainties, contingencies and other important factors, many of
which are outside the control of the Group.
Actual achievements, results,
performance or other future events or conditions may differ
materially from those stated, implied and/or reflected in any
forward-looking statements due to a variety of risks, uncertainties
and other factors (including without limitation those which are
referable to general market or economic conditions, regulatory and
government policy changes, increased volatility in interest rates
and inflation levels and other macroeconomic risks, geopolitical
tensions such as the Russia-Ukraine war and the Israel-Hamas war
and potential further escalations, specific economic developments,
such as the uncertain performance of the commercial real estate
sector in mainland China, or as a result of data limitations and
changes in applicable methodologies in relation to ESG related
matters).
Any such forward-looking statements
are based on the beliefs, expectations and opinions of the Group at
the date the statements are made, and the Group does not assume,
and hereby disclaims, any obligation or duty to update, revise or
supplement them if circumstances or management's beliefs,
expectations or opinions should change. For these reasons,
recipients should not place reliance on, and are cautioned about
relying on, any forward-looking statements. No representations or
warranties, expressed or implied, are given by or on behalf of the
Group as to the achievement or reasonableness of any projections,
estimates, forecasts, targets, commitments, ambitions, prospects or
returns contained herein.
Additional detailed information
concerning important factors, including but not limited to ESG
related factors, that could cause actual results to differ
materially from this news release is available in our Annual Report
and Accounts for the fiscal year ended 31 December 2023 filed with
the US Securities and Exchange Commission (the 'SEC') on Form 20-F
on 22 February 2024, our 1Q 2024 Earnings Release furnished to the
SEC on Form 6-K on 30 April 2024 and our Interim Report 2024 for
the six months ended 30 June 2024 which we expect to furnish to the
SEC on Form 6-K on or around 31 July 2024.
16
|
Use of alternative performance
measures
|
Our reported results are prepared in
accordance with International Financial Reporting Standards as
issued by the International Accounting Standards Board ('IFRS
Accounting Standards') as detailed in the interim condensed
consolidated financial statements starting on page 113 of the
Interim Report 2024.
To measure our performance, we
supplement our IFRS Accounting Standards figures with non-IFRS
Accounting Standards measures, which constitute alternative
performance measures under European Securities and Markets
Authority guidance and non-GAAP financial measures defined in and
presented in accordance with US Securities and Exchange Commission
rules and regulations. These measures include those derived from
our reported results that eliminate factors that distort
period-on-period comparisons. The 'constant currency performance'
measure used in this report is described below. Definitions and
calculations of other alternative performance measures are included
in 'Reconciliation of alternative performance measures' on pages 56
to 61 of the Interim Report 2024, which is available at
www.hsbc.com. All alternative performance measures are reconciled
to the closest reported performance measure.
The global business segmental results
are presented on a constant currency basis in accordance with IFRS
8 'Operating Segments' as detailed in Note 5: 'Segmental analysis'
on page 122 of the Interim Report 2024.
Constant currency performance
Constant currency performance is
computed by adjusting reported results for the effects of foreign
currency translation differences, which distort period-on-period
comparisons.
We consider constant currency
performance to provide useful information for investors by aligning
internal and external reporting, and reflecting how management
assesses period-on-period performance.
Notable items
We separately disclose 'notable
items', which are components of our income statement that
management would consider as outside the normal course of business
and generally non-recurring in nature. Certain notable items are
classified as 'material notable items', which are a subset of
notable items. Categorisation as a material notable item is
dependent on the nature of each item in conjunction with the
financial impact on the Group's income statement.
For further information on our use of
alternative performance measures, see pages 29 and 56 of the
Interim Report 2024.
Unless the context requires
otherwise, 'HSBC Holdings' means HSBC Holdings plc and 'HSBC', the
'Group', 'we', 'us' and 'our' refer to HSBC Holdings together with
its subsidiary undertakings. Within this document the Hong Kong
Special Administrative Region of the People's Republic of China is
referred to as 'Hong Kong'. When used in the terms 'shareholders'
equity' and 'total shareholders' equity', 'shareholders' means
holders of HSBC Holdings ordinary shares and those preference
shares and capital securities issued by HSBC Holdings classified as
equity. The abbreviations '$m' and '$bn' represent millions and
billions (thousands of millions) of US dollars,
respectively.
18
|
Investor Relations / Media Relations
contacts
|
For further information
contact:
Investor
Relations
Media Relations
UK - Neil
Sankoff
UK - Gillian James
Telephone: +44 (0)20 7991
5072
Telephone: +44 (0)7584 404
238
Email:
investorrelations@hsbc.com
Email: pressoffice@hsbc.com
Hong Kong - Yafei
Tian
UK - Kirsten Smart
Telephone: +852 2899
8909
Telephone: +44 (0)7725 733 311
Email:
investorrelations@hsbc.com.hk
Email: pressoffice@hsbc.com
Hong Kong - Aman Ullah
Telephone: +852 3941 1120
Email: aspmediarelations@hsbc.com.hk
Registered Office and Group Head
Office
HSBC Holdings plc
8 Canada Square
London E14 5HQ
United Kingdom
Tel: +44(0)20 7991 8888
Web: www.hsbc.com
Incorporated in England with limited
liability. Registered number 617987
Please click on the link below to
view the accompanying data pack.
http://www.rns-pdf.londonstockexchange.com/rns/5444Y_1-2024-7-31.pdf