恒生银行(00011) - 2023 - 中期财报

Financial Performance - Net operating income for the first half of 2023 reached HKD 19,940 million, a 29.1% increase from HKD 15,409 million in the same period of 2022[3] - Profit attributable to shareholders rose to HKD 9,827 million, up 78.3% from HKD 5,505 million year-on-year[3] - The average return on ordinary shareholders' equity improved to 12.8%, compared to 7.1% in the previous year[3] - Profit before tax increased by 71% year-on-year to HKD 10.961 billion, while profit attributable to shareholders rose by 79% to HKD 9.827 billion[22] - Earnings per share increased by 83% to HKD 4.99, with a return on average ordinary shareholders' equity of 12.8%, up from 7.1% in the same period last year[22] - The company reported a net profit of HKD 9,822 million for the first half of 2023, representing a 78.5% increase from HKD 5,497 million in the same period of 2022[147] - Total comprehensive income for the period was HKD 9,809 million, significantly up from HKD 4,017 million in the previous year[149] Asset and Liability Management - The bank's total assets stood at HKD 1,694,707 million as of June 30, 2023, down from HKD 1,854,446 million at the end of 2022[3] - Customer deposits decreased by 8%, but the liquidity coverage ratio stood at 230.6%, well above the regulatory requirement of 100%[18] - The loan-to-deposit ratio increased to 75.1% as of June 30, 2023, up from 72.4% at the end of 2022[42] - The total liabilities as of June 30, 2023, were HKD 169,809 million, up from HKD 166,741 million at the end of 2022, indicating a rise of 1.3%[145] - The company's total liabilities decreased to HKD 1,531,131 million from HKD 1,694,448 million, a reduction of 9.7%[150] Capital and Risk Management - The bank's common equity tier 1 capital ratio increased to 16.8% from 15.2% year-on-year[3] - Shareholders' equity increased by 2% to HKD 164 billion, reflecting retained earnings growth of 3% after dividend distributions[43] - The total capital ratio was 20.0% as of June 30, 2023, up from 18.1% at the end of 2022[116] - The group continues to monitor and identify risks, with key risks including credit risk, market risk, and regulatory compliance risk[44] - The group is committed to enhancing risk management practices, including third-party risk policies and climate risk assessments[50] Credit Quality and Impairment - Expected credit losses and other credit impairment provisions decreased by 8% year-on-year to HKD 1.924 billion, and decreased by 66% compared to the second half of the previous year[19] - The ratio of total impaired loans to total customer loans increased to 2.85% as of June 30, 2023, compared to 1.92% and 2.56% at the end of June and December 2022, respectively[19] - The expected credit loss provisions related to the third stage increased to HKD 31.91 billion in the first half of 2023, compared to HKD 28.91 billion in the same period of 2022[28] - The expected credit loss coverage ratio for Stage 1 loans was 0.10%, for Stage 2 was 2.99%, and for Stage 3 was 32.63%[67] Revenue Streams - Net interest income grew significantly, with a net interest margin improvement of 62 basis points to 2.09%[10] - Wealth management revenue increased by 10% year-on-year and by 40% compared to the second half of last year[10] - Non-interest income rose by 55%, driven by strong performance in equity-related wealth sales and new revenue from interest rate structured products[16] - Service fee income from credit card services increased by 27%, while service fee income from credit financing and trade decreased by 17% and 33%, respectively[19] Digital Innovation and Sustainability - The bank is actively promoting innovation and has been recognized with the "Outstanding Partnership Award" at the HKMA/HKT Global Innovation Awards 2022/23[5] - The bank aims to achieve net-zero carbon emissions by 2030 and has received recognition for its sustainable development efforts, ranking in the top 1% of S&P Global's 2022 ESG ratings for Chinese enterprises[8] - The bank plans to launch two digital Hong Kong dollar simulation tests in Q3 2023 as part of its central bank digital currency initiatives[5] - The bank is developing more sustainable financial products and services to meet increasing customer demand, diversifying its loan portfolio[21] Employee and Operational Adjustments - The number of full-time employees decreased from 9,123 on June 30, 2022, to 8,630 on June 30, 2023, reflecting operational adjustments[30] - Operating expenses increased by 5% year-on-year to HKD 7.156 billion, while the bank continues to focus on cost control[19] - The company continues to invest in IT systems and service resilience to support various business areas and minimize service disruptions[45] Economic Outlook - As of June 30, 2023, the management confirmed an improvement in the economic outlook for most markets, restoring the weight of the central scenario to the standard 75%[68] - The consensus central scenario predicts a GDP growth rate of 4.5% for Hong Kong and 5.4% for mainland China in 2023, with expectations of a gradual decline in inflation[72] - The unemployment rate is expected to average 3.3% in Hong Kong and 5.2% in mainland China for 2023, with a downward trend anticipated as economic recovery continues[72] - The ongoing Russia-Ukraine conflict has led to significant sanctions and trade restrictions, with the global economic impact stabilizing, but further sanctions could pose regulatory and market risks[52]