FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a - 16 or 15d - 16 of
the Securities Exchange Act of 1934
For the month of December 2005
HSBC Holdings plc
42nd Floor, 8 Canada
Square, London E14 5HQ, England
(Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F).
Form 20-F X Form 40-F ......
(Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934).
Yes....... No X
(If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): 82- ..............)
HSBC HOLDINGS PLC - PRE-CLOSE TRADING UPDATE
HSBC Holdings plc ("HSBC") will be conducting a trading update today with
analysts and investors ahead of its close period for the year ending 31 December
2005.
The meeting will take place by conference call from 10:00 am until 11:00 am
local time in London. Details for participating in the call can be found at the
end of this statement.
The information that will be covered during the meeting relating to HSBC's
operating performance is as follows:
HSBC's performance in the third quarter reflected continued progress. All
customer groups delivered higher pre-tax profits than achieved in the comparable
quarter in 2004. The geographic distribution of profits remained essentially in
line with prior periods. Notable within this performance, however, was broad
based expansion achieved throughout the Rest of Asia Pacific and, in particular,
strong asset and profit growth in the Middle East driven by the regional
benefits of the strong oil price.
Credit growth continued to be concentrated in the personal sector, split evenly
between residential mortgages and other personal credit. Underlying trends in
our US consumer finance business remained favourable, delivering growth at
broadly stable risk adjusted margins; delinquency trends remained stable. As
already announced, third quarter profits have been impacted by additional loan
impairment provisions necessitated by the consequences of Hurricane Katrina and
new bankruptcy legislation in the US. These incremental provisions amounted to
US$206 million and US$100 million respectively, the latter amount recognising a
projected rise in charge-offs after an exceptional spike in bankruptcy filings
in early October.
Within the UK personal sector, actions taken to strengthen lending underwriting
and collection activity are now contributing to improved credit experience; it
is, however, too early to conclude whether or not delinquency levels have
peaked.
Increased focus on deposit growth within the personal sector was reflected in a
number of new product initiatives and selective branch expansion in the United
States; deposit spreads improved in the United States and Hong Kong as short
term interest rates rose.
Commercial Banking continued to deliver strong results with broad based credit
expansion. Initiatives to expand deposit growth within the Commercial customer
base were successful in all major geographic regions and contributed to improved
spreads, particularly in Hong Kong. Credit impairment charges remained subdued
but evidence of weakness within the UK retail sector and related service
industries continued.
There were notable performances in asset management and in Global Transaction
Banking, within which our expanded funds administration business continued to
grow strongly and custody and payments and cash management revenues reflected
business growth especially in emerging markets. Private Equity results were good
and reflected a strong flow of realisations.
Global Markets delivered a strong trading quarter with continuing progress in
the areas of investment. This was evidenced by notable progress in league table
rankings and customer surveys, reflecting both increased market share and
customer satisfaction. Offsetting this to an extent was the impact of flattening
US dollar and HK dollar interest rate yield curves, which continued to
negatively impact balance sheet management and money market revenues.
Private Banking continued to deliver strong profitability and build for the
future, investing in additional offices in Europe, India and the United States.
Good growth in funds under management was achieved with particular strength in
discretionary mandates in Asia.
Cost performance in the third quarter was satisfactory and productivity improved
as net operating income before provisions outpaced underlying cost growth; in
substantial part this reflected progressive completion of the investment in
Corporate, Investment Banking and Markets (CIBM) as the operating platform is
built out.
On business development and acquisitions, we completed the purchase of a further
9.9 per cent of Ping An taking the aggregate holding to 19.9 per cent. The joint
credit card operation launched with Bank of Communications has issued more than
300,000 dual-currency cards since its launch in July 2005 and continues to grow
strongly.
HSBC Finance Corporation has announced it is now ready to complete its US$1.6
billion acquisition of Metris Companies Inc., the 11th largest issuer of
MasterCard and Visa cards in the US with receivables of approximately US$5.9
billion; this is expected to complete in early December.
CCF and four of its subsidiaries successfully re-branded as HSBC. Three hundred
and thirty branches (half of which are located in the greater Paris region)
opened their doors in early November as HSBC.
The disposal of Framlington Group Limited to AXA Investment Managers SA was
completed on 31 October 2005. The gain on sale of HSBC's indirect interest will
be reflected in the fourth quarter.
The Group's tier 1 and total capital ratios remained broadly in line with those
disclosed at the half year.
The outlook for the rest of the year suggests continuation of the broad trends
noted above although trading revenues are expected to be lower in the final
quarter. The possibility of unexpected economic events cannot be discounted in
light of continuing global imbalances. HSBC's credit appetite in many markets
remains selective in light of historically low risk pricing which could reverse
in the event of market disruption.
Good organic expansion opportunities continue to be pursued throughout Asia and
in Mexico, South America, Turkey and the Middle East. In Europe and the US we
are focussing on margins, productivity and capital efficiency. Through remaining
strongly capitalised and liquid and with broad based business and geographic
diversification HSBC remains well placed to continue its profitable growth.
HSBC's results for the year ending 31 December 2005 will be announced on Monday,
6 March 2006.
Conference call details
The conference call will be hosted by Douglas Flint, Group Finance Director and
will be accessible by dialling:
UK: +44 (0) 208 515 2361
US: +1 303 262 2140
Hong Kong: +852 3009 3050
A recording of the conference call will be available for seven days on HSBC's
website by following this link http://www.hsbc.com/precloseupdate from shortly
after the event.
For further information, please contact:
Investor Relations Media Relations
Patrick McGuinness Richard Lindsay
+44 (0) 20 7992 1938 +44 (0) 20 7992 1555
Forward-looking statements
This presentation and subsequent discussion may contain certain forward-looking
statements with respect to the financial condition, results of operations and
business of the Group. These forward-looking statements represent the Group's
expectations or beliefs concerning future events and involve known and unknown
risks and uncertainties that could cause actual results, performance or events
to differ materially from those expressed or implied in such statements.
Additional detailed information concerning important factors that could cause
actual results to differ materially is available in our Annual Report.
Notes to editors:
The HSBC Group
Serving over 110 million customers worldwide, the HSBC Group has approximately
9,700 offices in 77 countries and territories in Europe, the Asia-Pacific
region, the Americas, the Middle East and Africa. With assets of US$1,467
billion at 30 June 2005, HSBC is one of the world's largest banking and
financial services organisations. HSBC is marketed worldwide as 'the world's
local bank'.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
HSBC Holdings plc
By:
Name: P A Stafford
Title: Assistant Group Secretary
Date: 01 December 2005