HSBC 2015 Annual Report Download - page 70

Report of the Directors: Global businesses (continued)
RBWM
HSBC HOLDINGS PLC
68
Retail Banking and Wealth Management
RBWM provides banking and wealth
management services for our personal
customers to help them secure their future
prosperity and realise their ambitions.
Principal RBWM consists of
Total
RBWM28
US run-off
portfolio
Principal
RBWM
Banking
operations
Insurance
manufacturing
Asset
management
$m $m $m $m $m $m
2015
Net interest income 15,926 1,033 14,893 13,127 1,757 9
Net fee income/(expense) 6,218 (4) 6,222 5,726 (560) 1,056
Other income/(expense)33 1,372 (203) 1,575 876 680 19
Net operating income1 23,516 826 22,690 19,729 1,877 1,084
LICs34 (1,939) (62) (1,877) (1,877)
–
–
Net operating income 21,577 764 20,813 17,852 1,877 1,084
Total operating expenses (17,020) (1,384) (15,636) (14,459) (432) (745)
Operating profit/(loss) 4,557 (620) 5,177 3,393 1,445 339
Income from associates35 410
–
410 357 24 29
Profit/(loss) before tax 4,967 (620) 5,587 3,750 1,469 368
RoRWA24 2.5% (1.3%) 3.7%
2014
Net interest income 17,130 1,390 15,740 13,983 1,746 11
Net fee income/(expense) 6,836 (4) 6,840 6,264 (534) 1,110
Other income/(expense)33 1,183 (49) 1,232 602 608 22
Net operating income1 25,149 1,337 23,812 20,849 1,820 1,143
LICs34 (1,936) (30) (1,906) (1,906)
–
–
Net operating income 23,213 1,307 21,906 18,943 1,820 1,143
Total operating expenses (18,030) (738) (17,292) (16,060) (453) (779)
Operating profit 5,183 569 4,614 2,883 1,367 364
Income from associates35 398
–
398 323 40 35
Profit before tax 5,581 569 5,012 3,206 1,407 399
RoRWA24 2.5% 0.8% 3.2%
2013
Net interest income 18,808 2,061 16,747 15,003 1,725 19
Net fee income/(expense) 7,211 11 7,200 6,786 (625) 1,039
Other income/(expense)33 1,434 (400) 1,834 1,014 779 41
Net operating income1 27,453 1,672 25,781 22,803 1,879 1,099
LICs34 (3,510) (705) (2,805) (2,806)
–
1
Net operating income 23,943 967 22,976 19,997 1,879 1,100
Total operating expenses (17,774) (1,166) (16,608) (15,307) (554) (747)
Operating profit/(loss) 6,169 (199) 6,368 4,690 1,325 353
Income/(expense) from associates35 384 (1) 385 299 62 24
Profit/(loss) before tax 6,553 (200) 6,753 4,989 1,387 377
RoRWA24 2.6% (0.2%) 4.2%
For footnotes, see page 99.
RBWM comprises the Principal RBWM business and the US run-off portfolio. We believe that highlighting Principal RBWM (and its constituent
business streams, Banking Operations, Insurance Manufacturing and Asset Management) allows management to identify more readily the
causes of material changes from year-to-year in the ongoing business and assess the factors and trends that are expected to have a material
effect on the business in future years.
Insurance manufacturing for RBWM excluded other global businesses which contributed net operating income of $286m (2014: $358m, 2013:
$397m) and profit before tax of $201m (2014: $263m, 2013: $266m) to overall insurance manufacturing. In 2015 insurance manufacturing net
operating income for RBWM included $1,686m within Wealth Management (2014: $1,529m) and $191m within other products (2014: $350m).