HSBC Holdings plc 1Q 2015 Earnings Release 

• Reported PBT up 4% in the first quarter of 2015 (‘1Q15’) at $7,059m compared with $6,785m in the same period in 2014 (‘1Q14’).
• Adjusted PBT up $349m or 5% in 1Q15 at $6,892m, compared with $6,543m in 1Q14, primarily reflecting higher revenue of $661m and lower loan impairment charges of $136m, partly offset by higher operating expenses of $483m.
• Reported PBT of $7,059m is up by $5,328m compared with $1,731m in 4Q14. Adjusted PBT of $6,892m is up by $3,988m or 137% compared with $2,904m in 4Q14, led by higher revenue in GB&M following a challenging fourth quarter in 2014.
• Earnings per share and dividends per ordinary share for 1Q15 were $0.26 and $0.10, respectively, compared with $0.27 and $0.10 for the equivalent period in 2014.
• Return on average ordinary shareholders’ equity (annualised) was 0.2ppts lower at 11.5%, compared with 11.7% for the equivalent period in 2014.
• Adjusted revenue of $15,406m was higher by $661m or 4% from 1Q14 driven by revenue growth in GB&M, including an 8% rise in Markets, in CMB primarily in Hong Kong and the UK, and in Principal RBWM.
• Adjusted operating expenses of $8,526m were up by $483m or 6% from 1Q14 due to higher staff costs, partly reflecting an increase in staff numbers in customer-facing roles and in Regulatory Programmes and Compliance, and increased marketing expenditure to support growth.
• Loans and advances to customers, excluding foreign exchange movements, increased by $17,353m from 31 December 2014.
• Capital – The CRD IV end point CET1 capital ratio was 11.2%, up from 11.1% at 31 December 2014.
• Leverage ratio – The leverage ratio was 4.9%, up from 4.8% at 31 December 2014.

Group Chief Executive, Stuart Gulliver, commented:

Our business recovered well in the first quarter following a difficult 4Q14. Global Banking and Markets had its usual strong start to the year, with a notable increase in year-on-year revenue in our Markets businesses. Commercial Banking continued to perform well, particularly in the UK and Hong Kong, and Principal Retail Banking and Wealth Management generated increased revenue. Loan impairment charges were significantly lower compared to the same period in 2014, particularly in Europe and North America.

Adjusted operating expenses increased, as expected. We continue to work on initiatives to deliver cost-savings over the remainder of 2015 and beyond.

We generated $4.6bn of capital from profit in the period which enabled us to fund the first interim dividend, strengthen the CET1 capital ratio, and support asset growth.

As previously announced, HSBC will hold an Investor Update on 9 June.

Source: HSBC

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