2008 Interim Report Section 1

RNS Number : 6205A

HSBC Holdings PLC

04 August 2008

 



15    Equity

	Half-year to 30 June 2008
															Other reserves
	Called up share capital				Share  premium1				Other equity instru-ments				Retained  earnings2				Available- for-sale fair value reserve		Cash flow hedging  reserve3		Foreign exchange reserve		Share- based payment reserve		Merger  reserve4				Total share-holders' equity				Minority interests				Total equity
	US$m				US$m				US$m				US$m				US$m		US$m		US$m		US$m		US$m				US$m				US$m				US$m
At 1 January	5,915				8,134				-				81,097				850		(917)		10,055		1,968		21,058				128,160				7,256				135,416
Shares issued under employee share plans	2				50				-				-				-		-		-		-		-				52				-				52
Shares issued in lieu of dividends and amounts arising thereon1	86				(87)				-				2,489				-		-		-		-		-				2,488				-				2,488
Capital securities issued during the period5	-				-				2,134				-				-		-		-		-		-				2,134				-				2,134
Profit for the period	-				-				-				7,722				-		-		-		-		-				7,722				584				8,306
Dividends to shareholders	-				-				-				(6,823)				-		-		-		-		-				(6,823)				(506)				(7,329)
Own shares adjustment	-				-				-				(985)				-		-		-		-		-				(985)				-				(985)
Share of changes recognised directly in equity in the equity of associates or joint ventures	-				-				-				(342)				-		-		-		-		-				(342)				-				(342)
Actuarial losses on defined benefit plans	-				-				-				(883)				-		-		-		-		-				(883)				(27)				(910)
Exchange differences	-				-				-				3,085				26		(10)		21		-		-				3,122				48				3,170
Fair value gains/(losses) taken to equity	-				-				-				-				(8,292)		912		-		-		-				(7,380)				(181)				(7,561)
Amounts transferred to the income statement	-				-				-				-				(900)		(1,123)		-		-		-				(2,023)				(31)				(2,054)
Impairments taken to the income statement	-				-				-				-				384		-		-		-		-				384				-				384
Exercise and lapse of share options and vesting of share awards	-				-				-				500				-		-		-		(587)		-				(87)				-				(87)
Cost of share-based payment arrangements	-				-				-				-				-		-		-		427		-				427				-				427
Other movements	-				-				-				15				(30)		(12)		-		(77)		-				(104)				(5)				(109)
Tax on items taken directly to or transferred  from equity	-				-				-				203				696		24		-		-		-				923				13				936
Transfers	-				-				-				(3,088)				(26)		10		3,104		-		-				-				-				-
Net increase in minority interests arising on acquisitions, disposals and capital issuance	-				-				-				-				-		-		-		-		-				-				75				75
At 30 June	6,003				8,097				2,134				82,990				(7,292)		(1,116)		13,180		1,731		21,058				126,785				7,226				134,011

Cumulative goodwill amounting to US$5,138 million has been charged against reserves in respect of acquisitions of subsidiaries prior to 1 January 1998, including US$3,469 million charged against the merger reserve arising on the acquisition of HSBC Bank plc. The balance of US$1,669 million was charged against retained earnings.

For footnotes, see page 231

.

	Half-year to 30 June 2007
											Other reserves
	Called up share capital				Share premium1				Retained  earnings2				Available- for-sale fair value reserve		Cash flow hedging  reserve3		Foreign exchange reserve		Share- based payment reserve		Merger  reserve4				Total share-holders' equity				Minority interests				Total equity
	US$m				US$m				US$m				US$m		US$m		US$m		US$m		US$m				US$m				US$m				US$m
At 1 January	5,786				7,789				65,397				2,005		(101)		4,307		2,111		21,058				108,352				6,576				114,928
Shares issued under employee share plans	4				114				-				-		-		-		-		-				118				-				118
Shares issued in lieu of dividends and amounts  arising thereon1	67				(69)				2,828				-		-		-		-		-				2,826				-				2,826
Profit for the period	-				-				10,895				-		-		-		-		-				10,895				619				11,514
Dividends to shareholders	-				-				(6,192)				-		-		-		-		-				(6,192)				(474)				(6,666)
Own shares adjustment	-				-				(587)				-		-		-		-		-				(587)				-				(587)
Share of changes recognised directly in equity in the  equity of associates or joint ventures	-				-				186				-		-		-		-		-				186				-				186
Actuarial gains on defined benefit plans	-				-				2,004				-		-		-		-		-				2,004				24				2,028
Exchange differences	-				-				1,964				231		(9)		13		14		-				2,213				80				2,293
Fair value gains taken to equity	-				-				-				1,055		402		-		-		-				1,457				100				1,557
Amounts transferred to the income statement	-				-				-				(775)		(576)		-		-		-				(1,351)				-				(1,351)
Exercise and lapse of share options and vesting of  share awards	-				-				477				-		-		-		(443)		-				34				-				34
Cost of share-based payment arrangements	-				-				-				-		-		-		413		-				413				-				413
Other movements	-				-				(119)				(12)		(2)		-		(1)		-				(134)				(113)				(247)
Tax on items taken directly to or transferred from equity	-				-				(638)				130		54		-		-		-				(454)				(1)				(455)
Transfers	-				-				(1,964)				(231)		9		2,200		(14)		-				-				-				-
Net decrease in minority interests arising on acquisitions, disposals and capital issuance	-				-				-				-		-		-		-		-				-				(100)				(100)
At 30 June	5,857				7,834				74,251				2,403		(223)		6,520		2,080		21,058				119,780				6,711				126,491

Cumulative goodwill amounting to US$5,138 million has been charged against reserves in respect of acquisitions of subsidiaries prior to 1 January 1998, including US$3,469 million charged against the merger reserve arising on the acquisition of HSBC Bank plc. The balance of US$1,669 million was charged against retained earnings.

For footnotes, see page 231.

	Half-year to 31 December 2007
							Other reserves
	Called up share capital		Share  premium1		Retained  earnings2		Available- for-sale fair value reserve		Cash flow hedging  reserve3		Foreign exchange reserve		Share- based payment reserve		Merger  reserve4		Total share-holders' equity		Minority interests		Total equity
	US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m
At 1 July	5,857		7,834		74,251		2,403		(223)		6,520		2,080		21,058		119,780		6,711		126,491
Shares issued under employee share plans	13		346		-		-		-		-		-		-		359		-		359
Shares issued in lieu of dividends and amounts  arising thereon1	45		(46)		1,526		-		-		-		-		-		1,525		-		1,525
Profit for the period	-		-		8,238		-		-		-		-		-		8,238		703		8,941
Dividends to shareholders	-		-		(4,049)		-		-		-		-		-		(4,049)		(314)		(4,363)
Own shares adjustment	-		-		77		-		-		-		-		-		77		-		77
Share of changes recognised directly in equity in the  equity of associates or joint ventures	-		-		186		-		-		-		-		-		186		-		186
Actuarial gains/(losses) on defined benefit plans	-		-		230		-		-		-		-		-		230		(91)		139
Exchange differences	-		-		3,495		60		(19)		13		(14)		-		3,535		118		3,653
Fair value gains/(losses) taken to equity	-		-		-		(529)		214		-		-		-		(315)		139		(176)
Amounts transferred to the income statement	-		-		-		(938)		(1,323)		-		-		-		(2,261)		(14)		(2,275)
Exercise and lapse of share options and vesting of  share awards	-		-		281		-		-		-		(308)		-		(27)		-		(27)
Cost of share-based payment arrangements	-		-		-		-		-		-		457		-		457		-		457
Other movements	-		-		439		13		(4)		-		(261)		-		187		22		209
Tax on items taken directly to or transferred from equity	-		-		(82)		(99)		419		-		-		-		238		(9)		229
Transfers	-		-		(3,495)		(60)		19		3,522		14		-		-		-		-
Net decrease in minority interests arising on acquisitions, disposals and capital issuance	-		-		-		-		-		-		-		-		-		(9)		(9)
At 31 December	5,915		8,134		81,097		850		(917)		10,055		1,968		21,058		128,160		7,256		135,416

Cumulative goodwill amounting to US$5,138 million has been charged against reserves in respect of acquisitions of subsidiaries prior to 1 January 1998, including US$3,469 million charged against the merger reserve arising on the acquisition of HSBC Bank plc. The balance of US$1,669 million was charged against retained earnings.

1    Share premium includes the deduction of US$1 million (30 June 2007: US$2 million; 31 December 2007; US$1 million) in respect of issue costs incurred during the period.

2    Retained earnings include 187,083,746 (US$3,235 million) of own shares held within HSBC's insurance business, retirement funds for the benefit of policyholders or beneficiaries within employee trusts for the settlement of shares expected to be delivered under employee share schemes or bonus plans, and the market-making activities in Global Markets (30 June 2007; 165,269,416 (US$2,692 million): 31 December 2007; 158,706,463 (US$2,649 million)). 30 June 2007 numbers have been restated to conform with the current period's presentation.

3    Amounts transferred to the income statement in respect of cash flow hedges include US$172 million income (30 June 2007; US$112 million income: 31 December 2007; US$55 million loss) taken to 'Net interest income' and US$962 million (30 June 2007; US$456 million: 31 December 2007; US$1,373 million) taken to 'Net trading income'.

4    Statutory share premium relief under Section 131 of the Companies Act 1985 was taken in respect of the acquisition of HSBC Bank plc in 1992, HSBC France in 2000 and HSBC Finance Corporation in 2003 and the shares issued were recorded at their nominal value only. In HSBC's consolidated accounts the fair value differences of US$8,290 million in respect of HSBC France and US$12,768 million in respect of HSBC Finance Corporation comprise the merger reserve.

5    During April 2008, HSBC Holdings issued US$2,200 million of Perpetual Subordinated Capital Securities ('Capital Securities') of which there were US$66 million of issuance costs, which are classified as equity under IFRSs. The Capital Securities are exchangeable at HSBC Holdings' option into non-cumulative dollar preference shares on any coupon payment date. Interest on the Capital Securities is paid quarterly and may be deferred at the discretion of HSBC Holdings. The Capital Securities may only be redeemed at the option of HSBC Holdings.

 

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