2021-08-26 08:30Financial Performance - Adjusted profit after tax for the first half of 2021 was $8.4 billion, with basic earnings per share of $0.36, compared to $3.1 billion and $0.10 in the first half of 2020[9]. - The reported profit before tax for the first half of 2021 increased by $6.5 billion to $10.8 billion, while the reported profit after tax rose by $5.3 billion to $8.4 billion[14]. - Reported revenue decreased by 4% to $25.6 billion, primarily due to lower interest rates and reduced capital markets and securities services income[14]. - The company reported a pre-tax profit of $10.8 billion for the first half of 2021, an increase of 151% compared to the same period in 2020[25]. - Adjusted profit reached $12 billion, reflecting an increase of 111% year-on-year[25]. - The reported net profit after tax for the first half of 2021 was $8.422 billion, an increase of $5.297 billion compared to the first half of 2020[54]. - The company reported a pre-tax profit of $4.459 billion on a reported basis, with adjusted pre-tax profit at $6.680 billion, indicating a strong performance[127]. Loan and Deposit Growth - Loans increased by $21.5 billion, driven by growth in wealth management and personal banking, while deposits grew by $26.3 billion across all global businesses[14]. - Customer loans increased by 2% to $351 billion in the first half of 2021, driven primarily by an 8% growth in Asia, including a net increase of $6.7 billion in trade finance loans from Hong Kong and mainland China[35]. - The bank's total deposits increased by $27 billion, driven by growth across all global businesses[25]. - Customer loans (net) reached $1,059,511 million as of June 30, 2021, up from $1,018,681 million a year earlier[141]. Cost Management and Efficiency - The cost-to-income ratio improved to 62.9%, down from 56.9% in the previous year[18]. - The company achieved cost-saving measures resulting in $900 million in benefits, offsetting part of the expense increase[114]. - Adjusted operating expenses for the first half of 2021 were $16.2 billion, a 3% increase from $15.7 billion in the first half of 2020[50]. - The company has saved $2 billion as part of its cost-saving plan, with a target to save $5 billion to $5.5 billion by 2022[50]. Digital Banking and Technology Investments - The bank is making progress in digital banking services and has announced plans to potentially sell its retail banking operations in France and exit the U.S. mass market retail banking[9]. - The company has launched a new digital wallet service, HSBC Global Wallet, allowing businesses to hold, send, and receive multiple currencies[27]. - The bank's technology investment reached approximately $3 billion, an increase from the previous year, aimed at enhancing customer experience[25]. - The company is investing resources to improve the reliability and resilience of IT systems and critical services across various business areas[96]. Environmental, Social, and Governance (ESG) Initiatives - The bank's commitment to environmental, social, and governance (ESG) initiatives continues to progress, aligning with its climate commitments made in October 2020[9]. - HSBC's environmental, social, and governance rating was upgraded to "Leader" by MSCI, reflecting improvements in employee engagement and talent development[23]. - HSBC committed $100 million to the "HSBC Climate Solutions Partnership Program" to support companies and projects addressing climate change over five years[30]. - The company aims to achieve net-zero carbon emissions by 2050, with a commitment to exit coal financing in OECD countries by 2040 and report progress annually[43]. Economic Outlook and Market Conditions - Economic outlook has improved as countries emerge from the pandemic, despite ongoing uncertainties due to varying responses and new virus strains[8]. - The ongoing COVID-19 pandemic has led to significant operational challenges, with varying economic recovery rates across regions depending on government support and vaccination efforts[97]. - Geopolitical tensions and macroeconomic risks remain significant, with potential increases in tax liabilities if global minimum tax rates are implemented[98]. Strategic Business Changes - The bank is expanding its digital wealth management services in mainland China, hiring over 350 wealth managers to support growth[25]. - The company has initiated agreements to divest its retail banking operations in the U.S. and France, marking a strategic shift in its business portfolio[25]. - HSBC plans to reduce global office space by approximately 20%, equating to a reduction of about 3.6 million square feet by the end of 2021[27]. - The company is focusing on market expansion and new product development to drive future growth[122].