Regulatory News:
On 30 July 2024, HSBC Continental Europe’s Board of Directors
approved the consolidated financial statements for the first half
of 2024.
Andrew Wild, CEO of HSBC Continental Europe, said:
“We delivered a strong performance during the first half of 2024
which demonstrates the effectiveness of our strategy, leveraging on
our global franchise and our international connectivity. Our
ambition is to be the leading international wholesale bank in
Europe servicing corporates and financial institutions,
complemented by a targeted wealth and private banking
offering.”
Profit before tax1 was €502m for the first half of 2024,
driven by wholesale banking revenues, coupled with low credit
losses and continued cost discipline.
Net operating income before change in expected credit losses
and other credit impairment charges1 was €1,672m, down from
€1,885m in the first half of 2023, due to lower net interest income
following the sale of retail banking operations in France.
Wholesale revenues in Commercial Banking and Global Banking
remained strong, with growth in Global Payment Solutions and
Investment Banking, partly offset by lower lending volumes.
Revenues in Markets and Securities Services were down compared to
the first half of 2023, with lower client activity in Global Debt
Markets in the context of a challenging market environment, partly
offset by higher revenues in Equities and Securities Financing.
Change in expected credit losses and other credit impairment
charges1 was a charge of €18m, compared with a charge of €16m
in the first half of 2023. The cost of risk2, at 7bps, remained low
but was driven by provision releases that are not expected to
re-occur in the second half of 2024.
Operating expenses1 were €1,152m, compared to €1,126m in
the first half of 2023. Higher infrastructure and technology costs
and the acquisition of HSBC Private Bank (Luxembourg) S.A. were
partly offset by lower contributions to the Single Resolution
Fund.
Profit after tax for the period was €370m, down from
€1,944m in the first half of 2023 which included the reversal of
the impairment previously recognised in relation to the sale of
retail banking operations in France of €1.9bn pre-tax3.
The consolidated balance sheet of HSBC Continental Europe
showed total assets of €280bn at 30 June 2024, compared to €283bn
at 31 December 2023.
At 30 June 2024, HSBC Continental Europe reported an average
liquidity coverage ratio (LCR)4 of 156% and a net stable funding
ratio (NSFR)5 of 136%. The bank’s fully loaded common equity tier 1
(CET1) ratio was 15.1% and the fully loaded total capital ratio was
19.8%. The fully loaded leverage ratio was 4.3%. The solvency ratio
of the Insurance subsidiary was 287%6.
Appendix
Interim accounts were subject to a limited review by the
statutory auditors.
Summary consolidated income statement
€m
Half year to 30 June
2024
Half year to 30 June 2023
Continuing operations
Net interest income
941
1,173
Net fee income
594
585
Net income from financial instruments held
for trading or managed on a fair value basis
114
61
Other operating income/(expense)
23
66
Net operating income before change in
expected credit losses and other credit impairment charges
1,672
1,885
Change in expected credit losses and other
credit impairment charges
(18)
(16)
Total operating expenses
(1,152)
(1,126)
Profit/(loss) before tax
502
743
Tax expense
(132)
(187)
Profit/(loss) after tax in respect of
continuing operations
370
556
Profit/(loss) after tax in respect of
discontinued operations
—
1,388
Profit/(loss) after tax for the
period
370
1,944
Profit/(loss) attributable to
shareholders of the parent company
350
1,933
Profit/(loss) attributable to
non-controlling interests
20
11
Profit/(loss) for the period by global business
Continuing Operations
Wealth and Personal
Banking
Commercial Banking
Markets and Securities
Services
Global Banking
Global Banking and Markets
Other
Corporate Centre
Total
€m
Half year to 30 June
2024
Net operating income before change in
expected credit losses and other credit impairment charges
290
693
400
392
7
(110)
1,672
o/w net interest
income/(expense)
202
494
113
203
13
(84)
941
Change in expected credit losses and
other credit impairment charges
5
(30)
—
10
1
(4)
(18)
Total operating expenses
(204)
(319)
(361)
(214)
(11)
(43)
(1,152)
Profit/(loss) before tax
91
344
39
188
(3)
(157)
502
Half year to 30 June 2023
Net operating income before change in
expected credit losses and other credit impairment charges
313
712
433
369
8
50
1,885
o/w net interest income/(expense)
280
530
105
211
6
41
1,173
Change in expected credit losses and other
credit impairment charges
8
22
1
(48)
1
—
(16)
Total operating expenses
(185)
(290)
(394)
(189)
(17)
(51)
(1,126)
Profit/(loss) before tax
136
444
40
132
(8)
(1)
743
Business disposal – Retail banking operations in
France
On 1 January 2024, HSBC Continental Europe completed the sale of
its retail banking operations in France to CCF, a subsidiary of
Promontoria MMB SAS (‘My Money Group’). The sale also included HSBC
Continental Europe’s 100% ownership interest in HSBC SFH (France)
and its 3% ownership interest in Crédit Logement.
Upon being classified as held for sale in 2023, retail banking
operations in France met the criteria of discontinued operations
classification and presentation under IFRS 5. Accordingly, the
profit/(loss) of the discontinued operations as of June 2023
amounting to €1.4bn has been reported separately in the income
statement, including the reversal of pre-tax IFRS 5 loss of
€1.9bn.
HSBC Continental Europe
Headquartered in Paris, HSBC Continental Europe is an indirectly
held subsidiary of HSBC Holdings plc. HSBC Continental Europe
principally comprises, in addition to its banking, insurance and
asset management activities based in France, the business
activities of 10 European branches (in Belgium, Czech Republic,
Germany, Ireland, Italy, Luxembourg, Netherlands, Poland, Spain and
Sweden) and two bank subsidiaries in Continental Europe (in
Luxembourg and Malta). HSBC Continental Europe’s mission is to
serve both customers in Continental Europe for their needs
worldwide and customers in other Group countries for their needs in
Continental Europe.
HSBC Holdings plc
HSBC Holdings plc, the parent company of the HSBC Group, is
headquartered in London. HSBC serves customers worldwide from
offices in 60 countries and territories. With assets of US$2,975bn
at 30 June 2024, HSBC is one of the world’s largest banking and
financial services organisations.
Disclaimer
This press release contains certain forward-looking statements
with respect to the financial condition, results of operations and
business of the entity. Statements that are not historical facts,
including statements about the entity’s beliefs and expectations,
are forward-looking statements. Words such as ‘expects’,
‘anticipates’, ‘intends’, ‘plans’, ‘believes’, ‘seeks’,
‘estimates’, ‘potential’ and ‘reasonably possible’, variations of
these words and similar expressions are intended to identify
forward-looking statements. These statements are based on current
plans, estimates and projections, and therefore undue reliance
should not be placed on them. Forward-looking statements speak only
as of the date they are made. HSBC Continental Europe makes no
commitment to revise or update any forward-looking statements to
reflect events or circumstances occurring or existing after the
date of any forward-looking statement. Forward-looking statements
involve inherent risks and uncertainties. Readers are cautioned
that a number of factors could cause actual results to differ, in
some instances materially, from those anticipated or implied in any
forward-looking statements.
__________________________________ 1 In respect of continuing
operations. Retail banking operations in France met the criteria of
discontinued operations classification under IFRS 5 in 2023.
Accordingly, the profit/(loss) of the discontinued operations as of
June 2023 has been reported separately. 2 Annualised cost of risk
divided by customer loans outstanding at the end of the period. 3
As the sale no longer met the criteria for the operations to be
classified as held for sale in the first half of 2023. The
impairment was recognised again in the second half of 2023 ahead of
the completion of the sale on 1 January 2024. 4 Computed in respect
of the EU Delegated act. 5 Computed in respect of CRR II
(Regulation EU 2019/876). 6 LCR, NSFR and the solvency ratio of the
Insurance subsidiary are unaudited.
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version on businesswire.com: https://www.businesswire.com/news/home/20240731545246/en/
Raphaële-Marie Hirsch raphaele.marie.hirsch@hsbc.fr
+33 (0) 7 64 57 35 55