HSBC HOLDINGS(HSBC)2025-02-22 01:25Financial Data and Key Metrics Changes - The company reported a record profit before tax of 34.1 billion excluding notable items, with a return on tangible equity of 14.6%, or 16% excluding notable items, aligning with mid-teens targets [7][22][23] - A total of 0.87 per share in dividends and 42 billion in 2025, despite lower interest rates impacting growth [40][41] - Wealth management saw a significant increase, with a 27% year-on-year growth in the fourth quarter, marking the fourth consecutive quarter of double-digit growth [44][48] Market Data and Key Metrics Changes - The company attracted approximately 800,000 new personal banking customers in Hong Kong in 2024, indicating strong market growth [45][46] - The deposit base increased to 1.5 billion from non-strategic activities to priority growth areas, particularly in Asia and the Middle East [13][54] - Plans include expanding wealth centers in Hong Kong and enhancing transaction banking capabilities in high-growth markets [26][28] Management's Comments on Operating Environment and Future Outlook - The management expressed confidence in achieving mid-teens return on tangible equity in 2025, 2026, and 2027, despite challenges in the operating environment [24][60] - The outlook for global trade remains positive, with expectations of low-single-digit growth, benefiting from the bank's strong presence in key markets [105] Other Important Information - The company plans to incur approximately 1.5 billion by the end of 2025 [12][52] - The CET1 ratio stands at 14.9%, above the target range of 14% to 14.5%, providing a strong capital position for future growth [58][95] Q&A Session Summary Question: CIB Return on Tangible Equity Outlook - Management indicated that while specific medium-term returns for CIB were not provided, the business would benefit from cost synergies and improved capital allocation efficiencies [66][67] Question: Incremental Technology in International Wealth - Management emphasized the importance of investing in technology to enhance market share in cross-border wealth management, with a focus on integrating new platforms into existing services [70][72] Question: Cost Reallocation and Revenue Expectations - Management clarified that reallocating $1.5 billion from low-return activities is expected to yield higher returns, particularly in wealth and transaction banking, which are low capital-consuming businesses [82][84] Question: CET1 Ratio and Future Capital Management - Management confirmed comfort with the CET1 ratio target of 14% to 14.5%, with no immediate plans to lower it further, focusing instead on growth opportunities [94][95] Question: Loan Growth Challenges - Management acknowledged recent flat loan growth but expressed optimism for stabilization and potential growth as interest rates stabilize [121][122]