HSBC 2015 Annual Report Download - page 21

Progress against strategic actions
Strategic actions Targeted outcome
by 2017
Progress during 2015 Key performance indicators
Actions to resize and simplify the Group
Reduce Group
risk-weighted
assets (‘RWAs’)
by circa $290bn
See page 20
– Group RWA
reduction: $290bn
– GB&M return
to Group target
profitability; <1 /3
of Group RWAs
– GB&M: achieved over 50% of 2015–17 target
– CMB: achieved over 75% of 2015–17 target
– US Consumer and Mortgage Lending:
accelerated asset sales achieving nearly 40%
of 2015–17 RWA reduction target
– RWA reduction from management
actions: circa $124bn (circa 45%
of 2015–17 target on a constant
currency basis)
Optimise
global network
– Reduced footprint – Signed agreement to sell operations in Brazil,
subject to regulatory approval
– Presence reduced to 71 countries
and territories in 2015
Rebuild NAFTA
region profitability
See page 20
– US profit before
tax circa $2bn
– Mexico profit
before tax
circa $0.6bn
– Grew US CMB and GB&M adjusted revenue
by 4% and 12%, respectively
– Increased cross-border NAFTA region revenue
by more than 30%
– US (excluding CML run-off
portfolio) adjusted profit before
tax: $494m (up 6% on 2014)
– Mexico adjusted profit before tax:
$67m (down 1% on 2014)
Set up UK
ring-fenced
bank
– Completed by
2018
– Confirmed Birmingham as head office location
for the UK ring-fenced bank (HSBC UK)
– Established shared services entity in the UK
to remove critical interdependencies between
ring-fenced and non-ring-fenced businesses
– Implementation in progress
Deliver $4.5–5.0bn
of cost savings
See page 21
– 2017 exit rate
to equal 2014
operating
expenses
– Second-half costs in line with the first half from
tight cost control and effect of cost saving plans
– Cost-to-achieve expense of $0.9bn during 2015
– Adjusted costs (excluding Brazil):
up 5% on 2014
– FTE: 255,203 (down 1% on 2014)
Actions to redeploy capital and invest
Deliver growth
above GDP from
international
network
See page 46
– Revenue growth
of international
network above
GDP
– Average PCM deposits increased by 8%. Revenue
growth in FX and Securities Services businesses
– Strategic investment in receivables finance
platform (now live in more than 20 markets)
and launch of single dealer global FX platform
– Transaction banking revenue:
$15.7bn (up 4% on 2014)
– Revenue synergies: $11.6bn
(up 6% on 2014)
Investments in
Asia – prioritise
and accelerate
See page 21
– Market share gains
– Circa 10%
growth p.a. in
assets under
management
in Asia
– Pearl River Delta: management team in place
and new licences obtained (details on page 21)
– ASEAN: Enhanced capabilities and digital
propositions; Euromoney Best Domestic Cash
Manager Award for seven ASEAN markets
– Asset Management Global CEO relocated
to Hong Kong
– Among first fund managers selected for the
Mutual Recognition of Funds Programme
between Hong Kong and mainland China
– Guangdong loans: $4.3bn
(up 5% on 2014)
– ASEAN adjusted revenue: $3.2bn
(up 5% on 2014)
– Asset Management AUM
distributed in Asia: $129bn
(up 13% on 2014)
– Insurance manufacturing new
business premiums in Asia:
$2.0bn (up 7% on 2014)
Grow business
from renminbi
(‘RMB’)
internationalisation
– $2–2.5bn revenue – Among first banks to connect to the CIPS
(Cross-border Inter-bank Payment System)
– Joint global coordinator and bookrunner for the
People’s Bank of China’s RMB5bn bond issued
in London, its first debt offering outside China
– Renminbi internationalisation
revenue, from offshore business
partly or wholly denominated in
RMB as well as selected products
in mainland China: $1.7bn (up 3%
on 2014)
Global Standards
– safeguarding
against financial
crime
See page 21
– Completed
implementation
– Updated procedures in line with new anti-
money laundering and sanctions policies
– Enhanced infrastructure, including systems
related to customer due diligence, transaction
monitoring and screening
– Implementation in progress
Domicile
Headquarters
review
– Completed review
by end of 2015
– Review completed – Decision announced February
2016 to keep London as global
headquarters location
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HSBC HOLDINGS PLC
19
Strategic actions