Annual Financial Report - 11 of 56

2015

Europe

Asia

MENA

North

America

Latin

America

Total

UK

Hong

Kong

$m

$m

$m

$m

$m

$m

$m

$m

Revenue1

Reported31

21,058

25,303

2,565

7,657

6,592

59,800

15,493

15,616

Significant items

(656)

(1,431)

(10)

98

(36)

(2,035)

(595)

(1,383)

- disposal costs of Brazilian operations

-

-

-

-

18

18

-

-

- debit valuation adjustment ('DVA') on derivative contracts

(95)

(58)

(1)

(21)

(55)

(230)

(78)

(13)

- fair value movements on non-qualifying hedges32

200

2

-

124

1

327

204

6

- gain on the partial sale of shareholding in Industrial Bank

-

(1,372)

-

-

-

(1,372)

-

(1,372)

- loss on sale of several tranches of real estate secured accounts in the US

-

-

-

214

-

214

-

-

- own credit spread2

(771)

(3)

(9)

(219)

-

(1,002)

(731)

(4)

- provisions arising from the ongoing review of compliance with the Consumer Credit Act in the UK

10

-

-

-

-

10

10

-

Adjusted31

20,402

23,872

2,555

7,755

6,556

57,765

14,898

14,233

Loan impairment charges and other credit risk provisions ('LIC's)

Reported

(690)

(693)

(299)

(544)

(1,495)

(3,721)

(248)

(155)

Adjusted

(690)

(693)

(299)

(544)

(1,495)

(3,721)

(248)

(155)

Operating expenses

Reported31

(19,733)

(10,889)

(1,234)

(6,501)

(4,786)

(39,768)

(15,555)

(5,686)

Significant items

2,405

130

15

851

185

3,586

2,151

49

- disposal costs of Brazilian operations

-

-

-

-

110

110

-

-

- costs-to-achieve

600

122

14

103

69

908

536

43

- costs to establish UK ring-fenced bank

89

-

-

-

-

89

89

-

- regulatory provisions in GPB

172

-

-

-

-

172

-

-

- restructuring and other related costs

68

8

1

34

6

117

50

6

- settlements and provisions in connection with legal matters

935

-

-

714

-

1,649

935

-

- UK customer redress programmes

541

-

-

-

-

541

541

-

Adjusted31

(17,328)

(10,759)

(1,219)

(5,650)

(4,601)

(36,182)

(13,404)

(5,637)

Share of profit in associates and joint ventures

Reported

8

2,042

505

2

(1)

2,556

10

31

Adjusted

8

2,042

505

2

(1)

2,556

10

31

Profit/(loss) before tax

Reported

643

15,763

1,537

614

310

18,867

(300)

9,806

Significant items

1,749

(1,301)

5

949

149

1,551

1,556

(1,334)

- revenue

(656)

(1,431)

(10)

98

(36)

(2,035)

(595)

(1,383)

- operating expenses

2,405

130

15

851

185

3,586

2,151

49

Adjusted

2,392

14,462

1,542

1,563

459

20,418

1,256

8,472

2014

Europe

Asia

MENA

North

America

Latin

America

Total

UK

Hong

Kong

$m

$m

$m

$m

$m

$m

$m

$m

Revenue1

Reported31

21,571

23,677

2,548

8,152

8,272

61,248

15,727

13,844

Currency translation31

(2,013)

(680)

(50)

(252)

(1,871)

(4,775)

(1,058)

4

Significant items

708

(48)

(3)

116

(19)

754

353

(119)

- DVA on derivative contracts

234

69

5

16

8

332

203

26

- fair value movements on non-qualifying hedges32

235

4

-

302

-

541

(8)

11

- gain on sale of several tranches of realestate secured accounts in the US

-

-

-

(168)

-

(168)

-

-

- gain on sale of shareholding in Bank of Shanghai

-

(428)

-

-

-

(428)

-

(428)

- impairment of our investment in Industrial Bank

-

271

-

-

-

271

-

271

- own credit spread4

(393)

4

6

(34)

-

(417)

(474)

1

- provisions arising from the ongoing review of compliance with the Consumer Credit Act in the UK

632

-

-

-

-

632

632

-

- (gain)/loss and trading results from disposals and changes in ownership levels

-

32

(14)

-

(27)

(9)

-

-

Adjusted31

20,266

22,949

2,495

8,016

6,382

57,227

15,022

13,729

LICs

Reported

(764)

(647)

6

(322)

(2,124)

(3,851)

(214)

(320)

Currency translation

104

26

-

13

540

683

4

-

Significant items

-

-

(2)

-

2

-

-

-

- trading results from disposals and changes in ownership levels

-

-

(2)

-

2

-

-

-

Adjusted

(660)

(621)

4

(309)

(1,582)

(3,168)

(210)

(320)

Operating expenses

Reported31

(20,217)

(10,427)

(1,216)

(6,429)

(5,932)

(41,249)

(15,576)

(5,424)

Currency translation31

1,499

352

16

129

1,373

3,278

809

(1)

Significant items

2,601

58

33

578

125

3,395

2,553

56

- charge in relation to the settlement agreement with the Federal Housing Finance Authority

-

-

-

550

-

550

-

-

- regulatory provisions in GPB

16

49

-

-

-

65

-

49

- restructuring and other related costs

123

9

2

28

116

278

91

7

- settlements and provisions in connection with legal matters

1,187

-

-

-

-

1,187

1,187

-

- UK customer redress programmes

1,275

-

-

-

-

1,275

1,275

-

- trading results from disposals and changes in ownership levels

-

-

31

-

9

40

-

-

Adjusted31

(16,117)

(10,017)

(1,167)

(5,722)

(4,434)

(34,576)

(12,214)

(5,369)

Share of profit in associates and joint ventures

Reported

6

2,022

488

16

-

2,532

7

42

Currency translation

1

(38)

-

(2)

-

(39)

(1)

(1)

Adjusted

7

1,984

488

14

-

2,493

6

41

Profit/(loss) before tax

Reported

596

14,625

1,826

1,417

216

18,680

(56)

8,142

Currency translation

(409)

(340)

(34)

(112)

42

(853)

(246)

2

Significant items

3,309

10

28

694

108

4,149

2,906

(63)

- revenue

708

(48)

(3)

116

(19)

754

353

(119)

- LICs

-

-

(2)

-

2

-

-

-

- operating expenses

2,601

58

33

578

125

3,395

2,553

56

Adjusted

3,496

14,295

1,820

1,999

366

21,976

2,604

8,081