Annual Financial Report - 2 of 48

RNS Number : 3287B

HSBC Holdings PLC

03 April 2013

 



Who we are and what we do

HSBC is one of the world's largest banking and financial services organisations, with around 6,600 offices in both established and faster-growing markets. We aim to be where the economic growth is, connecting customers to opportunities, enabling businesses to thrive and economies to prosper, and ultimately helping people to fulfil their hopes and realise their ambitions.

We serve around 58 million customers through our four global businesses: Retail Banking and Wealth Management, Commercial Banking, Global Banking and Markets, and Global Private Banking. Our network covers 81 countries and territories in six geographical regions: Europe, Hong Kong, Rest of Asia-Pacific, Middle East and North Africa, North America and Latin America. Our aim is to be acknowledged as the world's leading international bank.

Listed on the London, Hong Kong, New York, Paris and Bermuda stock exchanges, shares in HSBC Holdings plc are held by about 220,000 shareholders in 129 countries and territories.

Highlights

·     Profit before tax down 6% to US$20.6bn and revenue down 5% to US$68.3bn on a reported basis.

·     Underlying profit before tax up 18% to US$16.4bn.

·     Continued to execute our strategy to grow, simplify and restructure the Group.

·     Underlying revenue up 7% reflecting revenue growth, notably in Global Banking and Markets and Commercial Banking.

·     Achieved sustainable savings of US$2.0bn, taking our total annualised savings to US$3.6bn, exceeding our cumulative target of US$2.5bn to US$3.5bn since 2011.

·     Announced 26 disposals and closures of non-strategic businesses and non-core investments in 2012.

·     Return on equity was 8.4%, down from 10.9% in 2011.

·     Dividends declared in respect of 2012 US$8.3bn or US$0.45 per ordinary share, up 10% on 2011.

·     Core tier 1 capital ratio increased during the year from 10.1% to 12.3%.

Cover image

Financing trade has always been at the heart of HSBC's business, especially in our home market of Hong Kong. Today, Hong Kong International Airport is the world's busiest air cargo hub, with its freight volume accounting for over one-third of the total value of Hong Kong's external trade.

Financial highlights

Earnings per share US$0.74 - down 20% 2011: US$0.92 2010: US$0.73		Dividends per ordinary share1 US$0.41 2011: US$0.39 2010: US$0.34		Net assets per share US$9.09 - up 7% 2011: US$8.48 2010: US$7.94

For the year

Profit before taxation US$20,649m - down 6% 2011: US$21,872m 2010: US$19,037m		Underlying profit before taxation US$16,385m - up 18% 2011: US$13,861m		Total operating income US$82,545m - down 1% 2011: US$83,461m 2010: US$80,014m
Net operating income before loan impairment charges and other credit risk provisions US$68,330m - down 5% 2011: US$72,280m 2010: US$68,247m		Profit attributable to the ordinary shareholders of the parent company US$13,454m - down 17% 2011: US$16,224m 2010: US$12,746m

At the year-end

Loans and advances to customers US$998bn - up 6% 2011: US$940bn 2010: US$958bn		Customer accounts US$1,340bn - up 7% 2011: US$1,254bn 2010: US$1,228bn		Ratio of customer advances to customer accounts 74.4% 2011: 75.0% 2010: 78.1%
Total equity US$183bn - up 10% 2011: US$166bn 2010: US$155bn		Average total shareholders' equity to average total assets 6.2% 2011: 5.6% 2010: 5.5%		Risk-weighted assets US$1,124bn - down 7% 2011: US$1,210bn 2010: US$1,103bn

Capital ratios

Core tier 1 ratio 12.3% 2011: 10.1% 2010: 10.5%		Tier 1 ratio 13.4% 2011: 11.5% 2010: 12.1%		Total capital ratio 16.1% 2011: 14.1% 2010: 15.2%

Performance ratios

Credit coverage ratios

Loan impairment charges to total operating income 9.9% 2011: 13.8% 2010: 16.9%		Loan impairment charges to average gross customer advances 0.9% 2011: 1.2% 2010: 1.5%		Total impairment allowances to impaired loans at year-end 41.7% 2011: 42.3% 2010: 43.0%

Return ratios

Return on average ordinary shareholders' equity2 8.4% 2011: 10.9% 2010: 9.5%		Return on average invested capital3 8.0% 2011: 10.2% 2010: 8.7%		Post-tax return on average total assets 0.6% 2011: 0.6% 2010: 0.6%		Pre-tax return on average risk-weighted assets 1.8% 2011: 1.9% 2010: 1.7%

Efficiency and revenue mix ratios

Cost efficiency ratio4 62.8% 2011: 57.5% 2010: 55.2%		Net interest income to total operating income 45.6% 2011: 48.7% 2010: 49.3%		Net fee income to total operating income 19.9% 2011: 20.6% 2010: 21.7%		Net trading income to total operating income 8.6% 2011: 7.8% 2010: 9.0%

Share information at the year-end

				Closing market price
US$0.50 ordinary shares in issue 18,476m 2011: 17,868m 2010: 17,686m		Market capitalisation US$194bn 2011: US$136bn 2010: US$180bn		London £6.47 2011: £4.91 2010: £6.51		Hong Kong HK$81.3 2011: HK$59.00 2010: HK$79.70		American Depositary Share5 US$53.07 2011: US$38.10 2010: US$51.04
				Total shareholder return6
				Over 1 year		Over 3 years		Over 5 years
To 31 December 2012 .....................................				139		104		113
Benchmarks:
- FTSE 1007 ......................................................				110		121		111
- MSCI World8 ..................................................				117		124		97
- MSCI Banks9 ..................................................				128		106		68

For footnotes, see page 120.

 

END

 

 

ACSITMMTMBAMBAJ