Annual Financial Report - 17 of 41

2010

Personal Financial Services US$m

Commercial

Banking US$m

Global Banking & Markets US$m

GlobalPrivate Banking US$m

Other

US$m

Inter- segment

elimination56

US$m

Total US$m

Profit/(loss) before tax

Net interest income/(expense)

9,912

1,525

952

190

(71)

(69)

12,439

Net fee income/(expense) ......

2,032

534

955

149

(6)

-

3,664

Trading income/(expense) excluding net interest income ...........................................

(472)

17

563

13

(12)

-

109

Net interest income ontrading activities .................

24

2

93

-

17

69

205

Net trading income/(expense)49

(448)

19

656

13

5

69

314

Changes in fair value of long-term debt issued and related derivatives ..........................

-

-

-

-

111

-

111

Net income/(expense) fromother financial instrumentsdesignated at fair value .......

6

-

(2)

-

(4)

-

-

Net income/(expense) from financial instrumentsdesignated at fair value .......

6

-

(2)

-

107

-

111

Gains less losses fromfinancial investments .........

5

(6)

141

-

3

-

143

Dividend income ....................

18

7

12

3

2

-

42

Net earned insurance premiums

245

-

-

-

-

-

245

Other operating income .........

(243)

242

64

15

2,351

(2,196)

233

Total operating income ......

11,527

2,321

2,778

370

2,391

(2,196)

17,191

Net insurance claims57 ............

(148)

-

-

-

4

-

(144)

Net operating income46 ......

11,379

2,321

2,778

370

2,395

(2,196)

17,047

Loan impairment (charges)/ recoveries and othercredit risk provisions ..........

(8,194)

(323)

184

38

-

-

(8,295)

Net operating income .........

3,185

1,998

2,962

408

2,395

(2,196)

8,752

Total operating expenses .......

(5,338)

(1,081)

(1,380)

(297)

(2,422)

2,196

(8,322)

Operating profit/(loss) .......

(2,153)

917

1,582

111

(27)

-

430

Share of profit/(loss) inassociates and joint ventures

4

22

-

-

(2)

-

24

Profit/(loss) before tax .......

(2,149)

939

1,582

111

(29)

-

454

%

%

%

%

%

%

Share of HSBC's profitbefore tax ...........................

(11.3)

5.0

8.3

0.6

(0.2)

2.4

Cost efficiency ratio ..............

46.9

46.6

49.7

80.3

101.1

48.8

Balance sheet data45

US$m

US$m

US$m

US$m

US$m

US$m

Loans and advances tocustomers (net) ..................

131,194

30,277

24,338

4,723

-

190,532

Total assets ...........................

154,086

39,213

306,416

5,824

9,373

(22,425)

492,487

Customer accounts .................

76,817

46,425

22,324

12,812

108

158,486

2009

Personal Financial Services US$m

Commercial

Banking US$m

GlobalBanking & Markets US$m

GlobalPrivate Banking US$m

Other

US$m

Inter-

segment

elimination56

US$m

Total US$m

Profit/(loss) before tax

Net interest income/(expense)

11,244

1,391

999

178

(84)

(58)

13,670

Net fee income ......................

3,174

453

1,045

142

3

-

4,817

Trading income/(expense) excluding net interest income ...........................................

257

(10)

(179)

(3)

(30)

-

35

Net interest income/(expense) on trading activities ............

60

3

175

(1)

1

58

296

Net trading income/(expense)49

317

(7)

(4)

(4)

(29)

58

331

Changes in fair value of long-term debt issued and related derivatives ..........................

-

-

-

-

(3,497)

-

(3,497)

Net income from other financial instruments designated atfair value ............................

-

-

-

-

1

-

1

Net expense from financial instruments designatedat fair value ........................

-

-

-

-

(3,496)

-

(3,496)

Gains less losses from financial investments ........................

16

3

277

-

-

-

296

Dividend income ....................

21

5

27

2

(2)

-

53

Net earned insurance premiums

309

-

-

-

-

-

309

Other operating income .........

9

162

317

11

1,828

(1,761)

566

Total operating income/(expense) ...............

15,090

2,007

2,661

329

(1,780)

(1,761)

16,546

Net insurance claims57 ............

(241)

-

-

-

-

-

(241)

Net operating income/(expense)46 .........................

14,849

2,007

2,661

329

(1,780)

(1,761)

16,305

Loan impairment charges and other credit risk provisions .

(14,424)

(519)

(621)

(98)

(2)

-

(15,664)

Net operating income/(expense) ...........................

425

1,488

2,040

231

(1,782)

(1,761)

641

Total operating expenses .......

(5,651)

(958)

(1,328)

(281)

(1,934)

1,761

(8,391)

Operating profit/(loss) ...........

(5,226)

530

712

(50)

(3,716)

-

(7,750)

Share of profit/(loss) inassociates and joint ventures

-

13

-

-

(1)

-

12

Profit/(loss) before tax ...........

(5,226)

543

712

(50)

(3,717)

-

(7,738)

%

%

%

%

%

%

Share of HSBC's profitbefore tax ...........................

(73.8)

7.7

10.1

(0.7)

(52.6)

(109.3)

Cost efficiency ratio ..............

38.1

47.7

49.9

85.4

(108.7)

51.5

Balance sheet data45

US$m

US$m

US$m

US$m

US$m

US$m

Loans and advances tocustomers (net) ..................

151,671

31,292

18,654

5,236

-

206,853

Total assets ............................

179,597

38,232

260,131

6,572

2,071

(11,589)

475,014

Customer accounts .................

74,228

42,900

19,095

12,834

100

149,157