Global Banks report their results
Commerzbank, Deutsche Bank, BNP Paribas, UBS AG, Mitsubishi UFJ Financial Group, Inc. and HSBC issued reports to inform public regarding interim results
HSBC Holdings plc
HSBC Holdings plc 2015 Interim Results – highlights
Financial performance
- Reported profit before tax (‘PBT’) up 10% in the first half of 2015 (‘1H15’) at $13,628m compared with $12,340m in the same period in 2014 (‘1H14’).
- Adjusted PBT up 2% in 1H15 at $13,002m compared with $12,722m in 1H14, driven by a strong performance in Asia.
- Earnings per share were $0.48 and dividends per ordinary share were $0.20 (in respect of the period), compared with $0.50 and $0.20 respectively for the equivalent period in 2014. The second interim dividend was $0.10.
- Adjusted revenue up 4% at $30,772m driven by revenue growth in client-facing GB&M, principally in Equities and Foreign Exchange. Revenue also increased in Principal RBWM and CMB.
- Adjusted operating expenses up 7% at $17,642m reflecting investment in growth, and regulatory programmes and compliance costs.
- Strong capital base with a CRD IV end point CET1 capital ratio of 11.6%, up from 11.1% at 31 December 2014.
Strategy execution
Clearly defined actions to capture value from our global network in a changed world:
- Growth of 6% in Global business synergies, demonstrating the strength of our universal banking model
- Revenue from transaction banking products grew 8% highlighting the value and potential of our international network
- Progress on reducing Group RWAs with a $50bn reduction relating mainly to GB&M
- Entered into an agreement to sell entire business in Brazil
- Commenced initiatives to reduce costs
Stuart Gulliver, Group Chief Executive, said:
“Our performance in the first half of 2015 demonstrated the underlying strength of our business. Our diversified, universal model enabled the Group to deliver increased profitability in spite of slow global growth. We are executing the actions that we announced at our Investor Update in June and our focus is on making significant progress during the remainder of the year.”
Read Full HSBC Results
Commerzbank
Operating profit increased to more than EUR 1 bn in first half of 2015
- Operating profit in Group increased to EUR 1,070 m (first half of 2014: EUR 581 m); in second quarter at EUR 385 m (Q2 2014: EUR 257 m)
- Revenues before loan loss provisions in Core Bank improved by approximately 14% to EUR 5.1 bn in first half (first half of 2014: EUR 4.5 bn) – revenues in all Core Bank segments higher than in first half of 2014 despite adverse interest rate environment
- Operating expenses in Group at EUR 1,753 m in second quarter of 2015 (Q2 2014: EUR 1,727 m)
- Net profit more than doubled to EUR 646 m (first half of 2014: EUR 300 m); net profit improved to EUR 280 m in second quarter of 2015 (Q2 2014: EUR 100 m)
- NCA with substantial portfolio run-down of EUR 1.0 bn in CRE and of EUR 1.8 bn in Ship Finance division – successful CRE transactions totalling EUR 2.9 bn will be visible in third quarter of 2015
- Loan loss provisions of EUR 280 m in Group in second quarter of 2015 (Q2 2014: EUR 257 m) and thus still at low level
- Capital ratio CET 1 increased to comfortable level of 10.5% as of end of June 2015 (end of March 2015: 9.5%)
- Blessing: “The substantially improved operating profit in the first six month of the year is clear testimony to the successful turnaround achieved by Commerzbank.”
Read Full Commerzbank Results
Deutsche Bank
Deutsche Bank reports second quarter 2015 net income of EUR 818 million
Group results
- Net income of EUR 818 million in 2Q2015 compared with EUR 238 million in 2Q2014
- Annualized post-tax return on average tangible shareholders’ equity of 5.7% compared with 2.1% in prior year quarter
- Income before income taxes (IBIT) of EUR 1.2 billion, up 34% from 2Q2014
- Net revenues of EUR 9.2 billion, up 17% year-on-year, reflecting growth in all businesses and favorable foreign exchange movements
- Noninterest expenses of EUR 7.8 billion, up 17% from 2Q2014
- Litigation charges of EUR 1.2 billion compared with EUR 470 million in 2Q2014. Litigation reserves held on balance sheet of EUR 3.8 billion at quarter end
Capital and leverage
- Common Equity Tier 1 (CET1) ratio* of 11.4% at quarter end, up 30 bps from 1Q2015
- CET1 capital* of EUR 47.4 billion, down EUR 0.5 billion from 1Q2015
- Risk-weighted assets (RWA)* of EUR 415.8 billion, down 4% from 1Q2015
- Leverage ratio* of 3.6%, up approximately 20 bps from 1Q2015
- Leverage exposure* of EUR 1,461 billion, down 6% from 1Q2015
- Tangible Book Value per share of EUR 39.42 decreased 4% compared to 1Q2015 as shareholders’ equity decreased due to negative Other Comprehensive Income, payment of dividend and AT1 coupon
*Fully-loaded Capital Requirements Regulation (CRR) / Capital Requirements Directive 4 (CRD4) basis
Read Full Deutsche Bank Results
BNP Paribas
BNP PARIBAS GROUP: RESULTS AS AT 30 JUNE 2015
Strong Income Growth and Solid Organic Capital Generation
BNP Paribas posted a very good performance this quarter in a context of a gradual return to growth in Europe. Revenues were up sharply and grew in all the operating divisions. The Group showed the strength of its integrated business model building on a solid and diversified customer base.
Revenues totalled 11,079 million euros, up by 15.8% compared to the second quarter 2014. They include this quarter an exceptional impact of +80 million euros in Own Credit Adjustment (OCA) and own credit risk included in derivatives (DVA). The one-off revenue items for the second quarter 2014 totalled -353 million euros.
The revenues of the operating divisions were up significantly (+12.2% compared to the second quarter 2014) with a very good growth at International Financial Services (+20.7%) and Corporate and Institutional Banking (+15.6%), and continued increase in Domestic Markets (1) (+2.7%). They also benefited from the positive impact of the acquisitions made in 2014.
Operating expenses, at 7,083 million euros, were up by 11.2%. They include the one-off impact of Simple & Efficient transformation costs and the restructuring costs of the acquisitions made in 2014 (6) which totalled 217 million euros (198 million euros in the second quarter 2014). The cost/income ratio improved significantly (-2.6 percentage points) at 63.9%.
The operating expenses of the operating divisions were up by 11.4%, resulting in a positive
0.8 point jaws effect. They were up by 2.3% in Domestic Markets (1), 20.7% in International Financial Services and 13.3% in CIB.
Gross operating income was up by 24.8%, at 3,996 million euros. It increased by 13.5% for the operating divisions.
Read Full BNP Paribas Results
UBS AG
UBS AG second quarter 2015 report
Group performance
Net profit attributable to UBS Group AG shareholders for the second quarter of 2015 was CHF 1,209 million compared
with CHF 1,977 million in the first quarter of 2015. We recorded an operating profit before tax of CHF 1,759 million
compared with CHF 2,708 million, largely reflecting a decrease of CHF 1,023 million in operating income, mostly driven
by a decline of CHF 635 million in combined net interest and trading income and CHF 400 million lower other income.
Operating expenses declined by CHF 75 million. We recorded a net tax expense of CHF 443 million compared with
CHF 670 million in the prior quarter.
Read Full UBS Results
Mitsubishi UFJ Financial Group, Inc.
Income statement summary
Net business profits
Gross profits increased compared to FY14 1Q mainly due to an increase in net interest income from overseas loans. Increases in fees from securitiesrelated businesses and profits from sales and trading businesses also contributed to the positive growth of gross profits.
G&A expenses increased compared to FY14 1Q mainly due to an increase in costs in overseas businesses by the depreciation of the Japanese yen.
As a result, net business profits for FY15 1Q increased ¥77.5bn from FY14 1Q to ¥416.8bn.
Total credit costs
Total credit costs for FY15 1Q on consolidated basis increased from FY14 1Q mainly due to increases in credit cost in our commercial and trust banking subsidiaries.
Net gains (losses) on equity securities
Net gains on equity securities increased mainly due to an increase in gains on sales of equity securities.
Profits (losses) from investments in affiliates
Profits from investments in affiliates increased as Morgan Stanley performed well during the period.
Profits attributable to owners of parent
Profits attributable to owners of parent increased ¥37.2bn from FY14 1Q to ¥277.7bn.
Read Full Mitsubishi UFJ Financial Group
Sources: HSBC, Commerzbank, Deutsche Bank, BNP Paribas, UBS AG, Mitsubishi UFJ Financial Group
