Annual Report and Accounts - 10 of 35

2008

Total

Personal Financial Services US$m

Commercial

Banking US$m

Global Banking & Markets US$m

Private Banking US$m

Other14

US$m

Inter- segment

elimination21

US$m

Total US$m

Net interest income/(expense) 

29,419 

9,494 

8,541 

1,612 

(956)

(5,547)

42,563 

Net fee income 

10,107 

4,097 

4,291 

1,476 

53

-

20,024 

Trading income/(expense) excluding net interest income 

175 

369 

157 

408 

(262)

-

847 

Net interest income/(expense) on trading activities 

79 

17 

324 

14 

(268)

5,547 

5,713 

Net trading income/(expense)16 

254 

386 

481 

422 

(530)

5,547 

6,560 

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

-

-

-

-

6,679

-

6,679

Net income/(expense) from other financial instruments designated at fair value 

(2,912)

(224)

(438)

-

747 

-

(2,827)

Net income/(expense) from financial instruments designated at fair value 

(2,912)

(224) 

(438)

-

7,426 

-

3,852 

Gains less losses from financial investments 

663 

193 

(327)

64 

(396)

-

197 

Dividend income 

90 

88 

76 

8 

10 

-

272 

Net earned insurance premiums 

10,083 

679 

105 

-

(17)

-

10,850 

Gains on disposal of French regional banks 

-

-

-

-

2,445

-

2,445

Other operating income 

259 

939 

868 

49 

4,261

(4,568)

1,808

Total operating income 

47,963 

15,652 

13,597 

3,631 

12,296

(4,568)

88,571 

Net insurance claims17 

(6,474)

(335)

(79)

-

(1)

-

(6,889)

Net operating income5 

41,489 

15,317 

13,518 

3,631 

12,295

(4,568)

81,682 

Loan impairment charges and other credit risk provisions 

(21,220)

(2,173)

(1,471)

(68)

(5)

-

(24,937)

Net operating income 

20,269 

13,144 

12,047 

3,563 

12,290

(4,568)

56,745 

Operating expenses (excluding goodwill impairment) 

(21,140)

(6,581)

(9,092)

(2,116)

(4,174)

4,568 

(38,535)

Goodwill impairment 

(10,564)

-

-

-

-

-

(10,564)

Operating profit/(loss) 

(11,435)

6,563 

2,955 

1,447 

8,116 

-

7,646 

Share of profit in associates and joint ventures 

461

631 

528 

-

41

-

1,661 

Profit/(loss) before tax 

(10,974)

7,194 

3,483 

1,447 

8,157

-

9,307 

%

%

%

%

%

%

Share of HSBC's profit before tax 

(117.9)

77.3 

37.4 

15.6 

87.6

100.0 

Cost efficiency ratio 

76.4 

43.0 

67.3 

58.3 

33.9

60.1 

Balance sheet data15

US$m

US$m

US$m

US$m

US$m

US$m

Loans and advances to  customers (net) 

401,402 

203,949 

287,306 

37,590 

2,621

932,868 

Total assets  

514,419 

249,218 

1,896,630 

133,216 

135,001

(401,019)

2,527,465 

Customer accounts 

440,338 

235,879 

320,386 

116,683 

2,041

1,115,327 

2007

Total

Personal Financial Services US$m

Commercial

Banking US$m

Global Banking & Markets US$m

Private Banking US$m

Other14

US$m

Inter- segment

elimination21

US$m

Total US$m

Net interest income/(expense) 

29,069 

9,055 

4,430 

1,216 

(542)

(5,433)

37,795 

Net fee income/(expense) 

11,742 

3,972 

4,901 

1,615 

(228)

-

22,002 

Trading income excluding net interest income 

38 

265 

3,503 

525 

127

-

4,458 

Net interest income/(expense)  on trading activities 

140 

31 

(236)

9 

(1)

5,433 

5,376 

Net trading income16 

178 

296 

3,267 

534 

126 

5,433 

9,834 

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

-

-

-

-

2,812

-

2,812

Net income/(expense) from other financial instruments designated at fair value 

1,333

22

(164)

(1)

81

-

1,271

Net income/(expense) from financial instruments  designated at fair value 

1,333 

22 

(164)

(1)

2,893 

-

4,083 

Gains less losses from  financial investments 

351 

90 

1,313 

119 

83 

-

1,956 

Gains arising from dilution of interests in associates 

-

-

-

-

1,092 

-

1,092 

Dividend income 

55 

8 

222 

7 

32 

-

324 

Net earned insurance premiums 

8,271 

733 

93 

-

(21)

-

9,076 

Other operating income 

387 

165 

1,218 

58 

3,523 

(3,912)

1,439 

Total operating income 

51,386 

14,341 

15,280 

3,548 

6,958 

(3,912)

87,601 

Net insurance claims17 

(8,147)

(391)

(70)

-

-

-

(8,608)

Net operating income5 

43,239 

13,950 

15,210 

3,548 

6,958 

(3,912)

78,993 

Loan impairment charges and other credit risk provisions 

(16,172)

(1,007)

(38)

(14)

(11)

-

(17,242)

Net operating income 

27,067 

12,943 

15,172 

3,534 

6,947 

(3,912)

61,751 

Total operating expenses 

(21,757)

(6,252)

(9,358)

(2,025)

(3,562)

3,912 

(39,042)

Operating profit 

5,310 

6,691 

5,814 

1,509 

3,385 

-

22,709 

Share of profit in associates  and joint ventures 

590 

454 

307 

2 

150 

-

1,503 

Profit before tax 

5,900 

7,145 

6,121 

1,511 

3,535

-

24,212 

%

%

%

%

%

%

Share of HSBC's profit  before tax

24.4 

29.5 

25.3 

6.2 

14.6

100.0 

Cost efficiency ratio 

50.3 

44.8 

61.5 

57.1 

51.2

49.4 

Balance sheet data15

US$m

US$m

US$m

US$m

US$m

US$m

Loans and advances to  customers (net) 

464,726 

220,068 

250,464 

43,612 

2,678

981,548 

Total assets 

621,356 

307,944 

1,561,468 

130,893 

155,685

(423,080)

2,354,266 

Customer accounts 

450,071 

237,987 

299,879 

106,197 

2,006

1,096,140 

2006

Total

Personal Financial Services US$m

Commercial

Banking US$m

Global Banking & Markets US$m

Private Banking US$m

Other14

US$m

Inter- segment

elimination21

US$m

Total US$m

Net interest income/(expense) 

26,076 

7,514 

3,168 

1,011 

(625)

(2,658)

34,486 

Net fee income 

8,762 

3,207 

3,718 

1,323 

172 

-

17,182 

Trading income/(expense) excluding net interest income 

391 

204 

4,890 

362 

(228)

-

5,619 

Net interest income/ (expense)  on trading activities 

220 

20 

(379)

2 

82 

2,658 

2,603 

Net trading income/(expense)16 

611 

224 

4,511 

364 

(146)

2,658 

8,222 

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

-

-

-

-

(35)

-

(35)

Net income/(expense) from other financial instruments designated at fair value 

739

(22)

20

1

(46)

-

692

Net income/(expense) from financial instruments  designated at fair value 

739 

(22)

20 

1 

(81)

-

657 

Gains less losses from  financial investments 

78 

44 

534 

166 

147 

-

969 

Dividend income 

31 

6 

235 

5 

63 

-

340 

Net earned insurance premiums 

5,130 

258 

73 

-

207 

-

5,668 

Other operating income 

782 

250 

1,378 

61 

3,254 

(3,179)

2,546 

Total operating income 

42,209 

11,481 

13,637 

2,931 

2,991 

(3,179)

70,070 

Net insurance claims17 

(4,365)

(96)

(62)

-

(181)

-

(4,704)

Net operating income5 

37,844 

11,385 

13,575 

2,931 

2,810 

(3,179)

65,366 

Loan impairment (charges)/ recoveries and other credit  risk provisions 

(9,949)

(697)

119 

(33)

(13)

-

(10,573)

Net operating income 

27,895 

10,688 

13,694 

2,898 

2,797 

(3,179)

54,793 

Total operating expenses 

(18,818)

(4,979)

(7,991)

(1,685)

(3,259)

3,179 

(33,553)

Operating profit/(loss) 

9,077 

5,709 

5,703 

1,213 

(462)

-

21,240 

Share of profit in associates  and joint ventures 

380 

288 

103 

1 

74 

-

846 

Profit/(loss) before tax 

9,457 

5,997 

5,806 

1,214 

(388)

-

22,086 

%

%

%

%

%

%

Share of HSBC's profitbefore tax 

42.8 

27.2 

26.3 

5.5 

(1.8)

100.0 

Cost efficiency ratio 

49.7 

43.7 

58.9 

57.5 

116.0 

51.3 

Balance sheet data15

US$m

US$m

US$m

US$m

US$m

US$m

Loans and advances to  customers (net) 

448,545

172,976

210,220

34,297

2,095

868,133

Total assets  

602,342

228,668

1,059,746

106,178

137,291

(273,467)

1,860,758

Customer accounts 

388,468

190,853

235,965

80,303

1,245

896,834