HSBC Holdings Regulatory News (HSBA)

Summary

33

Retail Banking and Wealth Management

34

Commercial Banking

35

Global Banking and Markets

36

Global Private Banking

37

Other

38

Basis of preparation

The results of global businesses are presented in accordance with the accounting policies used in the preparation of HSBC's consolidated financial statements. Our operations are closely integrated and, accordingly, the presentation of global business data includes internal allocations of certain items of income and expense. These allocations include the costs of some support services and global functions to the extent that they can be meaningfully attributed to operational business lines. While such allocations have been made on a systematic and consistent basis, they necessarily involve a degree of subjectivity. Those costs which are not allocated to global businesses are included in 'Other'.

Where relevant, income and expense amounts presented include the results of inter-segment funding as well as inter-company and inter-business line transactions. All such transactions are undertaken on arm's length terms.

The expense of the UK bank levy is included in the Europe geographical region as we regard the levy as a cost of being headquartered in the UK. For the purposes of the segmentation by global businesses, the cost of the levy is included in 'Other'.

Half-year to

30 June 2015

30 June 2014

31 December 2014

$m

%

$m

%

$m

%

Retail Banking and Wealth Management9

3,362

24.7

3,002

24.4

2,579

40.7

Commercial Banking9

4,523

33.2

4,814

39.0

4,000

63.1

Global Banking and Markets

4,754

34.9

5,033

40.8

856

13.5

Global Private Banking

180

1.3

364

2.9

262

4.1

Other13

809

5.9

(873)

(7.1)

(1,357)

(21.4)

13,628

100.0

12,340

100.0

6,340

100.0

At

30 June 2015

30 June 2014

31 December 2014

$m

%

$m

%

$m

%

Retail Banking and Wealth Management9

497,199

19.3

526,089

19.1

500,864

19.0

Commercial Banking9

378,641

14.7

375,014

13.6

370,958

14.1

Global Banking and Markets

1,790,461

69.6

2,043,767

74.2

1,839,644

69.8

Global Private Banking

85,740

3.3

99,379

3.6

88,342

3.4

Other

167,946

6.5

170,802

6.2

164,537

6.2

Intra-HSBC items

(348,274)

(13.4)

(461,458)

(16.7)

(330,206)

(12.5)

2,571,713

100.0

2,753,593

100.0

2,634,139

100.0

At

30 June 2015

30 June 2014

31 December 2014

$bn

%

$bn

%

$bn

%

Retail Banking and Wealth Management9

204.6

17.2

225.4

18.1

207.2

17.0

Commercial Banking9

439.6

36.8

422.5

33.8

430.3

35.3

Global Banking and Markets

491.0

41.1

537.3

43.0

516.1

42.3

Global Private Banking

21.1

1.8

22.1

1.8

20.8

1.7

Other

36.9

3.1

41.3

3.3

45.4

3.7

1,193.2

100.0

1,248.6

100.0

1,219.8

100.0

RBWM provides banking and wealth management services for our personal customers to help them secure their future prosperity and realise their ambitions.

Total

RBWM

US

run-off

portfolio

Principal

RBWM16

$m

$m

$m

Half-year to 30 June 2015

Net interest income

8,054

536

7,518

Net fee income/(expense)

3,334

(2)

3,336

Other income

1,054

46

1,008

Net operating income15

12,442

580

11,862

LICs

(934)

(47)

(887)

Net operating income

11,508

533

10,975

Total operating expenses

(8,354)

(688)

(7,666)

Operating profit/(loss)

3,154

(155)

3,309

Income from associates

208

-

208

Profit/(loss) before tax

3,362

(155)

3,517

RoRWA

3.3%

(0.6)%

4.6%

Half-year to 30 June 20149

Net interest income

8,617

750

7,867

Net fee income/(expense)

3,377

(1)

3,378

Other income/(expense)

622

(149)

771

Net operating income15

12,616

600

12,016

LICs

(1,299)

(180)

(1,119)

Net operating income

11,317

420

10,897

Total operating expenses

(8,530)

(361)

(8,169)

Operating profit

2,787

59

2,728

Income from associates

215

-

215

Profit before tax

3,002

59

2,943

RoRWA

2.6%

0.2%

3.8%

Half-year to 31 December 20149

Net interest income

8,513

640

7,873

Net fee income/(expense)

3,459

(3)

3,462

Other income

561

100

461

Net operating income15

12,533

737

11,796

LICs

(637)

150

(787)

Net operating income

11,896

887

11,009

Total operating expenses

(9,500)

(377)

(9,123)

Operating profit

2,396

510

1,886

Income from associates

183

-

183

Profit before tax

2,579

510

2,069

RoRWA

2.4%

1.7%

2.7%

Half-year to

30 Jun

30 Jun

31 Dec

2015

2014

2014

$m

$m

$m

Current accounts, savingsand deposits

2,815

2,766

2,845

Wealth Management products

3,605

3,008

2,879

- investment distribution

1,966

1,635

1,666

- life insurance manufacturing

1,080

866

681

- asset management

559

507

532

Personal lending

5,101

5,222

5,210

- mortgages

1,432

1,491

1,494

- credit cards

1,995

1,992

2,037

- other personal lending

1,674

1,739

1,679

Other

321

374

395

Net operating income15

11,842

11,370

11,329

CMB offers a full range of financial services and tailored solutions to almost three million customers ranging from small and medium-sized enterprises to publicly quoted companies in around 55 countries.

Half-year to

30 Jun

30 Jun

31 Dec

2015

20149

20149

$m

$m

$m

Net interest income

4,892

4,994

5,164

Net fee income

2,168

2,327

2,243

Other income

474

502

518

Net operating income15

7,534

7,823

7,925

LICs

(511)

(488)

(1,070)

Net operating income

7,023

7,335

6,855

Total operating expenses

(3,321)

(3,327)

(3,654)

Operating profit

3,702

4,008

3,201

Income from associates

821

806

799

Profit before tax

4,523

4,814

4,000

RoRWA

2.1%

2.4%

1.9%

Half-year to

30 Jun

30 Jun

31 Dec

2015

20149

20149

$m

$m

$m

Global Trade and Receivables Finance

1,219

1,214

1,266

Credit and Lending

2,982

2,747

2,925

Payments and Cash Management, current accounts and savings deposits

2,262

2,184

2,287

Markets products, Insurance and Investments and Other

1,071

1,069

996

Net operating income15

7,534

7,214

7,474

GB&M provides tailored financial solutions to major government, corporate and institutional clients worldwide.

Total

GB&M

Legacy

GB&M client facingand BSM

$m

$m

$m

Half-year to 30 June 2015

Net interest income

3,629

114

3,515

Net fee income/(expense)

1,711

(6)

1,717

Net trading income/(expense)6

3,743

(1)

3,744

Other income/(expense)

1,178

(10)

1,188

Net operating income15

10,261

97

10,164

LICs

11

15

(4)

Net operating income

10,272

112

10,160

Total operating expenses

(5,790)

(41)

(5,749)

Operating profit

4,482

71

4,411

-

Income from associates

272

Profit before tax

4,754

RoRWA

1.9%

0.4%

2.0%

Half-year to 30 June 2014

Net interest income/(expense)

3,602

(19)

3,621

Net fee income

1,939

4

1,935

Net trading income6

2,790

51

2,739

Other income

1,460

140

1,320

176

Net operating income15

9,791

176

9,615

LICs

(49)

217

(266)

Net operating income

9,742

393

9,349

Total operating expenses

(4,958)

(86)

(4,872)

Operating profit

4,784

307

4,477

Income from associates

249

Profit before tax

5,033

RoRWA

2.0%

1.3%

2.1%

Half-year to 31 December 2014

Net interest income/(expense)

3,420

(153)

3,573

Net fee income/(expense)

1,621

(11)

1,632

Net trading income/(expense)6

3,071

(106)

3,177

Other income/(expense)

(125)

92

(217)

Net operating income/ (expense)15

7,987

(178)

8,165

LICs

(316)

132

(448)

Net operating income/ (expense)

7,671

(46)

7,717

Total operating expenses

(7,070)

(622)

(6,448)

Operating profit/(loss)

601

(668)

1,269

Income from associates

255

Profit/(loss) before tax

856

RoRWA

0.3%

(2.7)%

0.6%

Half-year to

30 Jun

2015

30 Jun

2014

31 Dec 2014

$m

$m

$m

Markets

4,372

3,557

2,261

- Legacy credit

97

161

(177)

- Credit

492

395

138

- Rates

1,006

1,027

395

- Foreign Exchange

1,670

1,343

1,411

- Equities

1,107

631

494

Capital Financing

1,881

1,922

1,891

Payments and Cash Management

899

851

849

Securities Services

865

792

814

Global Trade and Receivables Finance

370

359

353

Balance Sheet Management

1,588

1,369

1,508

Principal Investments

128

318

182

Other17

15

18

(83)

Net operating income15

10,118

9,186

7,775

GPB serves high net worth individuals and families with complex and international financial needs within the Group's priority markets.

Half-year to

30 Jun

30 Jun

31 Dec

2015

2014

2014

$m

$m

$m

Net interest income

454

536

458

Net fee income

527

533

523

Other income/(expense)

196

161

166

Net operating income15

1,177

1,230

1,147

LICs

(5)

(6)

14

Net operating income

1,172

1,224

1,161

Total operating expenses

(1,001)

(868)

(910)

Operating profit

171

356

251

Income from associates

9

8

11

Profit before tax

180

364

262

RoRWA

1.8%

3.3%

2.4%

Half-year to

30 Jun 2015

30 Jun 2014

31 Dec 2014

$bn

$bn

$bn

At beginning of period

365

382

384

Net new money

(1)

(3)

-

- of which: areas targetedfor growth

7

5

9

Value change

9

6

2

Exchange and other

(3)

(1)

(21)

At end of period

370

384

365

'Other' contains the results of HSBC's holding company and financing operations, central support and functional costs with associated recoveries, unallocated investment activities, centrally held investment companies, certain property transactions and movements in fair value of own debt.

Half-year to

30 Jun

30 Jun

31 Dec

2015

2014

2014

$m

$m

$m

Net interest expense

(397)

(221)

(280)

Net fee income/(expense)

(15)

1

(66)

Net trading income/(expense)

(123)

(120)

28

- changes in fair value of long-term debt issued and related derivatives

1,324

438

70

- changes in other financial instruments designatedat fair value

(661)

(719)

710

Net income/(expense) from financial instruments designated at fair value

663

(281)

780

Other income

4,559

3,279

3,245

Net operating income

4,687

2,658

3,707

Total operating expenses

(3,879)

(3,533)

(5,068)

Operating profit/(loss)

808

(875)

(1,361)

Income from associates

1

2

4

Profit/(loss) before tax

809

(873)

(1,357)