HSBC 2015 Annual Report Download - page 375

HSBC HOLDINGS PLC
373
Strategic Report Financial Review Corporate Governance Financial Statements Shareholder Information
11 Segmental analysis
Accounting policy
HSBC has a matrix management structure. HSBC’s chief operating decision-maker is the Group Management Board (‘GMB’) which operates
as a general management committee under the direct authority of the Board. The GMB regularly reviews operating activity on a number of
bases, including by geographical region and by global business. HSBC considers that geographical operating segments represent the most
appropriate information for the users of the financial statements to best evaluate the nature and financial effects of the business activities in
which HSBC engages, and the economic environments in which it operates. This reflects the importance of geographical factors on business
strategy and performance, the allocation of capital resources, and the role of geographical regional management in executing strategy. As a
result, HSBC’s operating segments are considered to be geographical regions.
Geographical information is classified by the location of the principal operations of the subsidiary or, for The Hongkong and Shanghai Banking
Corporation, HSBC Bank plc, HSBC Bank Middle East and HSBC Bank USA, by the location of the branch responsible for reporting the results
or providing funding.
Measurement of segmental assets, liabilities, income and expenses is in accordance with the Group’s accounting policies. Segmental income
and expenses include transfers between segments and these transfers are conducted at arm’s length. Shared costs are included in segments
on the basis of the actual recharges made. The expense of the UK bank levy is included in the Europe geographical region as HSBC regards
the levy as a cost of carrying on business and being headquartered in the UK.
Products and services
HSBC provides a comprehensive range of banking and related financial services to its customers in its five geographical regions.
HSBC’s operating segments are Europe, Asia, Middle East and North Africa, North America and Latin America. The products
and services offered to customers are organised by global business.
• Retail Banking and Wealth Management (‘RBWM’) offers a broad range of products and services to meet the personal
banking and wealth management needs of individual customers. Typically, customer offerings include personal banking
products (current and savings accounts, mortgages and personal loans, credit cards, debit cards and local and international
payment services) and wealth management services (insurance and investment products, global asset management
services and financial planning services).
• Commercial Banking (‘CMB’) offers a broad range of products and services to serve the needs of our commercial customers,
including small and medium-sized enterprises, mid-market enterprises and corporates. These include credit and lending,
international trade and receivables finance, treasury management and liquidity solutions (payments and cash management
and commercial cards), commercial insurance and investments. CMB also offers its customers access to products and
services offered by other global businesses, for example Global Banking and Markets (‘GB&M’), which include foreign
exchange products, raising capital on debt and equity markets and advisory services.
• GB&M provides tailored financial solutions to major government, corporate and institutional clients and private investors
worldwide. The client-focused business lines deliver a full range of banking capabilities including financing, advisory and
transaction services, a markets business that provides services in credit, rates, foreign exchange, equities, money markets
and securities services, and principal investment activities.
• Global Private Banking (‘GPB’) provides a range of services to high net worth individuals and families with complex and
international needs within the Group’s priority markets.