HSBC 2026 Conference Summary Company Overview - **Company**: HSBC (NYSE: HSBC) - **Date**: March 18, 2026 - **Speaker**: Pam Kaur, Group CFO Key Points Industry Context - The banking industry is currently facing challenges due to geopolitical tensions, particularly the conflict in the Middle East, which has raised concerns about operational continuity and customer safety [4][5][6]. Financial Performance and Targets - HSBC aims for a return on tangible equity (ROTE) target of over 17% and anticipates a growth trajectory of 5% between 2027 and 2028 [5][6]. - The Middle East region contributes approximately 5% to HSBC's profit before tax (PBT), with significant contributions from HSBC Bank Middle East ($1 billion) and Saudi Awwal Bank (31% share contributing $700 million) [4]. Risk Management - HSBC is monitoring various risks, including cyber threats and operational continuity, due to the ongoing conflict [5]. - The bank has not adjusted its expected credit loss (ECL) guidance, assuming a short-term impact from the conflict [5][6]. Private Credit Exposure - HSBC's exposure to private credit is less than 2% of its loan book, approximately $20 billion, with a minority being secondary exposures reliant on third-party due diligence [11][12]. Growth Strategies - HSBC is reallocating $1.8 billion in costs to strategic growth opportunities, particularly in Asia, and is focused on enhancing operational efficiencies across its four business segments [13][14]. - The bank is optimistic about growth in its wealth management business, leveraging its strong customer base and expanding product offerings [16][62]. Technology and AI Deployment - HSBC is investing in AI to enhance productivity and operational efficiency, with over 80% of employees utilizing a productivity suite [46][47]. - The bank aims to deploy AI in areas such as KYC onboarding and transaction monitoring to improve efficiency and customer experience [49][50]. Capital Management - HSBC maintains a disciplined approach to capital management, focusing on organic growth while being open to strategic acquisitions that align with its long-term goals [34][35]. - The bank emphasizes the importance of maintaining a strong balance sheet and liquidity position to support its operations and customer needs [75][76]. Market Opportunities - HSBC sees growth potential in the wealth management sector, particularly in emerging markets with growing middle classes, such as China and India [62]. - The bank is also exploring opportunities in digital assets and tokenized deposits, aligning with its strategy to enhance its digital offerings [69][70]. Conclusion - HSBC is committed to navigating current challenges while focusing on strategic growth, operational efficiency, and leveraging technology to enhance customer service and profitability [75][79].

Group 1 - Nvidia's CEO Jensen Huang stated a revenue expectation of over $1 trillion, indicating strong visibility, which only includes revenue from the Blackwell and Rubin product lines, excluding upcoming products and new markets. Nvidia plans to return 50% of its free cash flow to investors, with stock buybacks and dividends expected in the second half of the year [3] - Qualcomm announced a $20 billion stock buyback plan and raised its quarterly dividend from $0.89 to $0.92 per share, reflecting confidence in future performance. The company continues to advance in 5G and chip-related technology development, maintaining a robust supply chain in IoT and automotive electronics [3] - Micron Technology announced that its HBM4 production line will begin mass production in Q1 2026, with initial products designed for Nvidia's Vera Rubin platform, meeting high-end AI computing memory needs [4] Group 2 - Tesla signed a supply agreement with LG Energy to build a $4.3 billion lithium iron phosphate battery manufacturing plant in Lansing, Michigan, with production expected to start in 2027. CEO Elon Musk stated that any legal gains from the lawsuit against OpenAI will be donated to charity [4] - Alibaba launched the world's first enterprise-level AI-native work platform "Wukong," designed to enhance operational efficiency and support digital transformation across various industries, with pilot applications already underway [5] - Tencent Music reported Q4 revenue of 8.64 billion yuan, a 15.9% year-over-year increase, and a net profit of 2.2 billion yuan, up 12.6%. For the full year 2025, total revenue reached 32.9 billion yuan, a 15.8% increase, with net profit growing 66.4% [7] Group 3 - BYD is developing L4 autonomous vehicles based on the NVIDIA DRIVE Hyperion platform, leveraging Nvidia's computing power and technology to accelerate the development and production of high-level autonomous driving technology [7] - Pengding Holdings announced a 11 billion yuan investment for a high-end PCB production base, aiming to capture demand from AI technology development and enhance its market share in high-end printed circuit boards [8] - Baidu announced the launch of its first AI desktop assistant DUMate, which integrates various capabilities from its ecosystem, aiming to become a commonly used tool in daily work [8] Group 4 - Amazon's CEO predicts that AI will drive AWS cloud service sales to reach $600 billion by 2036, doubling previous expectations, and has partnered with OpenAI to sell AI-related products to U.S. government agencies [11] - Microsoft is restructuring its AI business, integrating commercial and consumer Copilot product lines, and slowing down the aggressive AI integration into Windows 11 [11] - Meta announced a $27 billion computing partnership with AI infrastructure provider Nebius to enhance its AI capabilities while scaling back its metaverse business [11]

香港交易及結算所有限公司及香港聯合交易所有限公司對本文件的內容概不負責，對 其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本文件全部或任何部分 內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任 。 2026 年3月18日 （香港股份代號 : 5） HSBC Holdings plc 滙豐控股有限公司 發行永久後償或有可轉換證券 隨附之公告現正於若干 HSBC Holdings plc 滙豐控股有限公司上市之證券交易所發布。 代表 滙豐控股有限公司 集團公司秘書長 麥安琦 於本公告發表之日，滙豐控股有限公司董事會成員包括： 聶智恆*、艾橋智、鮑哲鈺†、孫瑋†、段小纓†、范貝恩女爵士†、傅偉思†、高安賢†、古肇華†、郭珮 瑛、麥浩智博士†、莫佩娜†、梅愛苓†及張瑞蓮†。 * 獨立非執行主席 † 獨立非執行董事 HSBC Holdings plc 滙豐控股有限公司 註冊辦事處及集團總管理處： 8 Canada Square, London E14 5HQ, United Kingdom 網站：www.hsbc.com 英格蘭及威爾斯註冊有限公司。註冊編號： 617987 非於美國發布或分發 2026 ...

Group 1 - Cécile Ratcliffe has been appointed as the CEO of HSBC Continental Europe, effective from June 1, 2026, pending regulatory approval, succeeding Christopher Davies [3][4] - Under Ratcliffe's leadership, HSBC Continental Europe aims to be a financing powerhouse and the number one international bank for corporate and institutional clients, enhancing connections between Europe and the global market [4][5] - Michael Roberts, CEO of HSBC Bank plc, expressed his support for Ratcliffe's appointment and acknowledged the contributions of Christopher Davies during the transition [5] Group 2 - Cécile Ratcliffe has extensive experience in the banking sector, having joined Citigroup in 1993 and held various leadership roles, including Chief Country Officer for France and Belgium [6] - HSBC Continental Europe operates as a subsidiary of HSBC Holdings plc, providing corporate and institutional banking, private banking, insurance, and asset management services across ten European countries [8] - As of December 31, 2025, HSBC Holdings plc reported total assets of US$3,233 billion, positioning it as one of the largest banking and financial services organizations globally [7]

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **US electricity sector**, particularly the impact of **data centres** and **AI** on electricity demand growth over the next decade and beyond [2][10][22]. Core Insights and Arguments - **Electricity Demand Growth**: The US is expected to see a **1.4 PWh** increase in electricity demand over the next 10 years, representing a **30% increase** compared to 2025 estimates. Approximately **50%** of this growth (or **0.6 PWh**) will be driven by data centres, with the remainder coming from electric vehicles (EVs), building electrification, and industrial growth, offset by efficiency improvements [2][24]. - **Long-term Forecast**: The report anticipates a sustained annual growth rate of **2-3%** in electricity demand for the next **25 years**, marking a return to growth after **25 years of flat demand** [31][32]. - **Historical Context**: Historically, US electricity demand has fluctuated, with periods of high growth (c8% from 1950-75) and flat demand (1998-2023). The current era is characterized by a return to moderate growth supported by renewables and gas [3][40][51]. Data Centre Impact - **Significant Contribution**: Data centres are projected to quadruple their electricity demand from **200 TWh in 2025** to **900 TWh by 2035**, making up **50%** of the demand growth from **2024-2035** in the US, compared to **6-10%** in China and the EU [19][18][15]. - **Concentration of Growth**: The growth of data centres is expected to be highly concentrated, with **85%** of new capacity additions occurring in the US, Europe, and China [14]. Utility Sector Dynamics - **Utilities' Response**: US utilities are currently facing challenges in processing a surge of new load applications, many of which are speculative. There is a tendency for utilities to overestimate demand, but as processes improve, forecasts are expected to stabilize [5][70]. - **Connection Preferences**: Hyperscalers prefer locations in the **East of the US** and urban/suburban areas close to existing hubs, with securing grid connections being a top priority [4][58][66]. Forecasting Challenges - **Demand Forecasting Uncertainty**: There is significant uncertainty in demand forecasts due to the speculative nature of many applications and the historical tendency of utilities to overstate growth. The report highlights a range of estimates for data centre electricity consumption, from **300 TWh to over 1000 TWh** by 2030 [72][80]. - **Efficiency Considerations**: The long-term impact of AI on electricity demand may include efficiency gains, potentially offsetting some of the expected growth in demand from data centres [81]. Additional Insights - **Global Comparison**: The US is expected to experience electricity demand growth ahead of Europe but behind Asia, with growth rates of **4-5%** anticipated in China and India compared to **2-3%** in the US [51][52]. - **Future Projections**: By **2030**, the share of data centres in total electricity demand could rise to **10%**, increasing to **15% by 2035** and **20% by 2050** [34][37]. This summary encapsulates the key points discussed in the conference call, providing a comprehensive overview of the expected trends and dynamics in the US electricity sector, particularly regarding the influence of data centres and AI on future demand.

Core Insights - The primary focus for income investors is generating consistent cash flow, particularly through dividends, which are a significant portion of long-term returns [2][5] Company Overview - HSBC, headquartered in London, has experienced a price change of -0.61% this year and currently pays a dividend of $2.24 per share, yielding 11.48%, significantly higher than the Banks - Foreign industry's yield of 2.61% and the S&P 500's yield of 1.47% [3] - The company's annualized dividend of $8.98 has increased by 173.8% from the previous year, with an average annual increase of 41.32% over the last five years [4] Dividend Growth and Earnings - Future dividend growth for HSBC will depend on earnings growth and the payout ratio, which is currently at 26%, indicating that 26% of its trailing 12-month EPS is paid out as dividends [4] - The Zacks Consensus Estimate for HSBC's earnings in 2026 is $7.95 per share, with an expected increase of 5.30% from the previous year [5] Investment Opportunity - HSBC is positioned as a compelling investment opportunity due to its attractive dividend yield and strong Zacks Rank of 2 (Buy), making it appealing to income investors [6]

Core Viewpoint - HSBC upgraded NIO stock to Buy, highlighting expectations for stronger vehicle growth in 2026 due to the launch of new models across the NIO, ONVO, and FIREFLY brands [1] Group 1 - HSBC's upgrade reflects confidence in NIO's future performance, particularly with the introduction of new vehicle models [1] - The anticipated growth in vehicle sales is a key factor driving the positive outlook for NIO [1]

Group 1 - Allianz and Sun Life Financial are considering making offers for HSBC's Singapore-based insurance business as part of a strategic review initiated by HSBC [1][3] - Other potential bidders include Japan's Dai-ichi Life Holdings and Nippon Life Insurance, with initial offers expected in the coming weeks [2][4] - HSBC's insurance unit in Singapore is estimated to be valued at over $1 billion, and the bank has described Singapore as a priority market [3][4] Group 2 - HSBC launched a review of its insurance arm in Singapore in January, linked to a broader global restructuring effort [3] - The bank previously acquired AXA Singapore for $529 million four years ago, and recent management changes have led to further reductions in certain business lines [4]

Group 1 - Zhaoyi Innovation (03986) saw an intraday increase of 1.72% amid rising shipping risks in the Hormuz Strait affecting the supply chain of key raw materials like helium [1] - Rongchang Bio (09995) rose over 3.6% after its RC288 injection application was accepted by NMPA, showing excellent anti-tumor activity and safety in preclinical studies [1] - Swire Properties (01972) increased by over 2.2% following the release of its 2025 full-year results, reporting revenue of HKD 16.041 billion, a year-on-year increase of 11%, and a basic earnings per share of HKD 1.49 [1] Group 2 - Health 160 (02656) surged over 10%, reaching a new high of HKD 140.5, with a nearly doubled stock price since March 9, despite a previous drop of about 30% on February 11 [2] - Gaming stocks collectively rose, with notable increases in companies like Boyaa Interactive (00434) up 4.44% and Tencent (00700) up 1.1%, following Apple's announcement of a commission rate adjustment for the App Store in mainland China [2] - Qidian Guofeng (01280) experienced a significant rise of over 26% after announcing a sales contract for AI servers with an independent third party [2] Group 3 - Hong Kong bank stocks fell again, with Standard Chartered (02888) down 4.67% and HSBC Holdings (00005) down 3.8%, amid ongoing tensions in the Middle East affecting transactions involving Asian balance sheets [3] - Cement stocks saw a general increase, with China National Building Material (03323) up 2.62%, as construction activity picked up post-Lantern Festival, leading to a steady recovery in cement market demand [3] - Domestic property stocks rebounded, with CIFI Holdings (00884) up 2.9% and Sunac China (01918) up 5.45%, as recent data indicated a 3.3% year-on-year decline in second-hand housing listings in Shenzhen [4] Group 4 - Yao Cai Securities (01428) saw a significant rise of over 39% after extending the acquisition offer deadline with Ant Group to March 25, 2026 [4] - PayPay (PAYP.US), a digital wallet operator backed by SoftBank, debuted on the US stock market with a 13.5% increase, achieving a market cap of nearly USD 12 billion [5] - Chinese electric vehicle companies NIO (NIO.US) and Xpeng Motors (XPEV.US) saw stock increases of 1.46% and 3.58%, respectively, amid discussions of potential collaborations with European automotive giant Stellantis [5] Group 5 - Storage stocks collectively declined, with SanDisk (SNDK.US) down 5.59% and Micron Technology (MU.US) down 3.19%, following negative sentiment from short-seller Citron Capital [6] - Optical communication stocks fell, with Applied Optoelectronics (AAOI.US) down 16.39%, despite securing a bulk order for a new data center transceiver [6] - Agricultural input stocks continued to rise, with CF Industries Holdings (CF.US) up 13.21%, driven by supply chain disruptions in the Middle East affecting fertilizer transportation [7] Group 6 - Oil stocks rose sharply, with Battalion Oil (BATL.US) up 15.48% as international oil prices surged, with WTI crude rising over 8% to USD 94.66 [8] - EHang Intelligent (EH.US) reported total revenue of RMB 509.5 million (approximately USD 72.9 million) for the fiscal year 2025, marking an 11.7% year-on-year increase, despite a net loss of RMB 231 million [8]

Group 1 - Hong Kong bank stocks have declined again, with Standard Chartered down 3.17% at HKD 167.9 and HSBC down 3.03% at HKD 125 [1] - The ongoing geopolitical tensions in the Middle East have led several global banks, including HSBC and Standard Chartered, to inform some Middle Eastern clients that certain transactions involving Asian balance sheets will be postponed [1] - As regional conflicts escalate, bank officials are privately reassessing their expansion plans in the Gulf region and carefully weighing the risks arising from the Middle Eastern conflicts [1] Group 2 - According to a report by JPMorgan analysts, HSBC and Standard Chartered are the European banks with the largest exposure to Middle Eastern risks, with contributions to their pre-tax profits from the region being 4% and 12% respectively [1]