Annual Financial Report - 9 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)

5,536

2,774

2,936

871

(654)

(213)

11,250

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

2,016

1,570

1,863

883

39

-

6,371

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

(7)

3

1,542

185

(262)

-

1,461

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

(1)

19

1,127

21

23

213

1,402

Net trading income/(expense)49

(8)

22

2,669

206

(239)

213

2,863

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

-

-

-

-

(365)

-

(365)

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

496

113

(23)

-

61

-

647

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

496

113

(23)

-

(304)

-

282

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

29

-

460

(7)

4

-

486

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

-

1

16

2

1

-

20

Net earned insurance premiums

3,800

278

-

-

(11)

-

4,067

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

165

163

839

7

754

189

2,117

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

12,034

4,921

8,760

1,962

(410)

189

27,456

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

(4,364)

(342)

-

-

-

-

(4,706)

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

7,670

4,579

8,760

1,962

(410)

189

22,750

Loan impairment (charges)/ recoveries and other creditrisk provisions ....................

(1,217)

(997)

(783)

(26)

3

-

(3,020)

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

6,453

3,582

7,977

1,936

(407)

189

19,730

Total operating expenses .......

(5,166)

(2,378)

(5,265)

(1,296)

(1,151)

(189)

(15,445)

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

1,287

1,204

2,712

640

(1,558)

-

4,285

Share of profit in associatesand joint ventures ...............

2

1

14

-

-

-

17

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

1,289

1,205

2,726

640

(1,558)

-

4,302

%

%

%

%

%

%

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

6.8

6.3

14.3

3.4

(8.2)

22.6

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

67.4

51.9

60.1

66.1

(280.7)

67.9

Balance sheet data45

US$m

US$m

US$m

US$m

US$m

US$m

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

145,063

91,744

170,375

27,629

988

435,799

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

202,431

111,356

965,462

76,631

65,824

(172,177)

1,249,527

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

168,979

96,597

169,873

56,114

-

491,563

2009

Personal Financial Services US$m

Commercial

Banking US$m

GlobalBanking & Markets US$m

GlobalPrivate Banking US$m

Other

US$m

Inter- segment

elimination 56

US$m

Total US$m

Profit/(loss) before tax

Net interest income/(expense)

5,413

2,739

4,367

949

(525)

(675)

12,268

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

1,949

1,679

1,670

883

86

-

6,267

Trading income excluding net interest income ..................

34

3

2,267

175

382

-

2,861

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

(1)

17

1,869

23

15

675

2,598

Net trading income49 ..............

33

20

4,136

198

397

675

5,459

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

-

-

-

-

(2,746)

-

(2,746)

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

1,012

133

375

-

(199)

-

1,321

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

1,012

133

375

-

(2,945)

-

(1,425)

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

20

2

25

5

(2)

-

50

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

2

1

26

3

(3)

-

29

Net earned insurance premiums

3,975

253

(2)

-

(3)

-

4,223

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

182

373

670

28

914

95

2,262

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

12,586

5,200

11,267

2,066

(2,081)

95

29,133

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

(5,221)

(365)

-

-

(3)

-

(5,589)

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

7,365

4,835

11,267

2,066

(2,084)

95

23,544

Loan impairment charges and other credit risk provisions .

(1,992)

(1,267)

(2,277)

(29)

(3)

-

(5,568)

Net operating income/

(expense) ...........................

5,373

3,568

8,990

2,037

(2,087)

95

17,976

Total operating expenses .......

(5,062)

(2,294)

(4,447)

(1,183)

(907)

(95)

(13,988)

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

311

1,274

4,543

854

(2,994)

-

3,988

Share of profit in associatesand joint ventures ...............

1

18

2

-

-

-

21

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

312

1,292

4,545

854

(2,994)

-

4,009

%

%

%

%

%

%

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

4.4

18.3

64.2

12.1

(42.3)

56.7

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

68.7

47.4

39.5

57.3

(43.5)

59.4

Balance sheet data45

US$m

US$m

US$m

US$m

US$m

US$m

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

147,760

89,084

176,123

25,541

973

439,481

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

208,669

111,874

981,831

76,871

84,010

(194,655)

1,268,600

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

165,161

102,249

169,390

58,213

6

495,019