Interim Report - 9 of 24

Our principal banking subsidiaries in Hong Kong are The Hongkong and Shanghai Banking Corporation Limited and Hang Seng Bank Limited. The former is the largest bank incorporated in Hong Kong and is our flagship bank in Asia.

We offer a wide range of banking and financial services in mainland China through our local subsidiaries, HSBC Bank (China) Company Limited and Hang Seng Bank (China) Limited. We also participate indirectly in mainland China through our associate, Bank of Communications.

Outside Hong Kong and mainland China in Asia, we conduct business in 18 countries and territories, with particularly strong coverage in Australia, India, Indonesia, Malaysia, Singapore and Taiwan.

Half-year to

30 Jun

30 Jun

31 Dec

2015

2014

2014

$m

$m

$m

Net interest income

6,060

6,090

6,183

Net fee income

3,291

2,966

2,944

Net trading income

1,779

1,329

1,293

Other income

2,935

1,722

1,150

Net operating income15

14,065

12,107

11,570

LICs

(246)

(216)

(431)

Net operating income

13,819

11,891

11,139

Total operating expenses

(5,457)

(5,009)

(5,418)

Operating profit

8,362

6,882

5,721

Income from associates

1,038

1,012

1,010

Profit before tax

9,400

7,894

6,731

Loans and advances to customers (net)

371,639

362,387

362,955

Customer accounts

599,940

570,221

577,491

RoRWA

3.8%

3.4%

2.7%

Cost efficiency ratio

38.8%

41.4%

46.8%

Period-end staff numbers

120,588

115,111

118,322

Half-year to

30 Jun

30 Jun

31 Dec

2015

2014

2014

$m

$m

$m

Hong Kong

7,750

6,820

6,908

Australia

421

420

424

India

929

870

896

Indonesia

267

252

258

Mainland China

1,331

1,214

1,234

Malaysia

519

473

484

Singapore

653

620

640

Taiwan

218

262

217

Other

558

588

566

12,646

11,519

11,627