Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 52

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 52
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4, we revised the adjustments made to RoTE from excluding only the impact of strategic transactions and the impairment of BoCom, to exclude all notable items. This was intended to improve alignment with the treatment of notable items in our other income statement disclosures. RoTE excluding notable items has been re-presented for 2023 on the revised basis and we no longer disclose RoTE excluding strategic transactions and the impairment of BoCom. RoTE excluding notable items was 16.0% , a decrease of 0.2 percentage points compared with 2023. We are now targeting a mid-teens RoTE in each of the three years from 2025 to 2027 excluding notable items. Our targets and expectations reflect our current outlook for the global macroeconomic environment and market-dependent factors, such as market-implied interest rates as of mid- January 2025 and rates of foreign exchange, as well as customer behaviour and activity levels. Target basis operating expenses $32.6bn (2023: $31.1bn ) In 2024, reported operating expenses increased by 3.0% compared with 2023. Target basis operating expense growth was 5.1% compared with 2023, in line with our target of approximately 5%. Growth primarily reflected higher investment spend, including in technology and from inflationary pressures. Our target basis operating expenses for 2024 excluded the direct cost impact of the disposals in France and Canada from the 2023 baseline. It is measured on a constant currency basis and excludes notable items and the impact of retranslating the prior year results of hyperinflationary economies at constant currency. We retain a Group-wide focus on cost discipline. We are targeting growth in target basis operating expenses of approximately 3% in 2025 compared with 2024. Our target basis operating expenses for 2025 excludes the direct cost impact of the business disposals in Canada and Argentina, notable items and the impact of retranslating the prior year results of hyperinflationary economies at constant currency. Our cost target includes the impact of simplification-related savings associated with our announced reorganisation, which aims to generate approximately $0.3bn of cost reductions in 2025, with a commitment to an annualised reduction of $1.5bn in our cost base expected by the end of 2026 . To deliver these reductions, we plan to incur severance and other up-front costs of $1.8bn over 2025 and 2026, which