Annual Report and Accounts -

RNS Number : 7325P

HSBC Holdings PLC

31 March 2009

 



By geographical region

Profit before tax

	Year ended 31 December 2008
	Europe		Hong Kong		Rest of Asia- Pacific		North America		Latin America		Intra- HSBC items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m
Interest income	35,117		9,530		11,517		25,897		11,632		(2,392)		91,301
Interest expense	(25,421)		(3,832)		(6,024)		(10,679)		(5,174)		2,392		(48,738)
Net interest income	9,696		5,698		5,493		15,218		6,458		-		42,563
Fee income	10,225		3,062		3,154		6,292		2,716		(685)		24,764
Fee expense	(2,733)		(482)		(596)		(1,065)		(549)		685		(4,740)
Net fee income	7,492		2,580		2,558		5,227		2,167		-		20,024
Trading income/(expense) excluding net interest income	1,691		856		1,823		(3,879)		356		-		847
Net interest income on trading activities	3,666		337		621		744		345		-		5,713
Net trading income/(expense)	5,357		1,193		2,444		(3,135)		701		-		6,560
Changes in fair value of long- term debt issued and related derivatives	2,939		3		1		3,736		-		-		6,679
Net income/(expense) from other financial instruments designated at fair value	(1,826)		(1,194)		(172)		1		364		-		(2,827)
Net income from financial instruments designated at  fair value	1,113		(1,191)		(171)		3,737		364		-		3,852
Gains less losses from financial investments	418		(309)		32		(120)		176		-		197
Dividend income	130		41		4		77		20		-		272
Net earned insurance premiums	5,299		3,247		197		390		1,717		-		10,850
Gains on disposal of French regional banks	2,445		-		-		-		-		-		2,445
Other operating income	2,096		817		1,064		23		300		(2,492)		1,808
Total operating income	34,046		12,076		11,621		21,417		11,903		(2,492)		88,571
Net insurance claims incurred  and movement in liabilities to policyholders	(3,367)		(1,922)		28		(238)		(1,390)		-		(6,889)
Net operating income before loan impairment charges  and other credit risk provisions	30,679		10,154		11,649		21,179		10,513		(2,492)		81,682
Loan impairment charges and other credit risk provisions	(3,754)		(765)		(1,131)		(16,795)		(2,492)		-		(24,937)
Net operating income1	26,925		9,389		10,518		4,384		8,021		(2,492)		56,745
Total operating expenses (excluding depreciation, amortisation and impairment)	(14,979)		(3,631)		(5,440)		(8,891)		(5,603)		2,492		(36,052)
Depreciation of property, plant  and equipment	(865)		(209)		(188)		(265)		(223)		-		(1,750)
Amortisation of intangible  assets	(228)		(103)		(35)		(203)		(164)		-		(733)
Goodwill impairment	-		-		-		(10,564)		-		-		(10,564)
Total operating expenses	(16,072)		(3,943)		(5,663)		(19,923)		(5,990)		2,492		(49,099)
Operating profit/(loss)	10,853		5,446		4,855		(15,539)		2,031		-		7,646
Share of profit in associates  and joint ventures	16		15		1,613		11		6		-		1,661
Profit/(loss) before tax	10,869		5,461		6,468		(15,528)		2,037		-		9,307

	Year ended 31 December 2007
	Europe		Hong Kong		Rest of Asia- Pacific		North America		Latin America		Intra- HSBC items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m
Interest income	33,144		12,580		10,158		30,183		9,471		(3,177)		92,359
Interest expense	(25,398)		(7,097)		(6,015)		(15,336)		(3,895)		3,177		(54,564)
Net interest income	7,746		5,483		4,143		14,847		5,576		-		37,795
Fee income	10,973		3,860		2,709		6,733		2,647		(585)		26,337
Fee expense	(2,542)		(498)		(463)		(923)		(494)		585		(4,335)
Net fee income	8,431		3,362		2,246		5,810		2,153		-		22,002
Trading income/(expense) excluding net interest income	3,003		1,270		1,202		(1,289)		272		-		4,458
Net interest income/(expense) on trading activities	3,940		(28)		441		747		276		-		5,376
Net trading income/(expense)	6,943		1,242		1,643		(542)		548		-		9,834
Changes in fair value of long- term debt issued and related derivatives	1,059		2		1		1,750		-		-		2,812
Net income from other financial instruments designated at fair value	167		674		110		-		320		-		1,271
Net income from financial instruments designated at  fair value	1,226		676		111		1,750		320		-		4,083
Gains less losses from financial investments	1,326		94		38		245		253		-		1,956
Gains arising from dilution of interests in associates	-		-		1,081		-		11		-		1,092
Dividend income	171		31		8		105		9		-		324
Net earned insurance premiums	4,010		2,797		226		449		1,594		-		9,076
Other operating income	1,193		845		798		360		228		(1,985)		1,439
Total operating income	31,046		14,530		10,294		23,024		10,692		(1,985)		87,601
Net insurance claims incurred  and movement in liabilities to policyholders	(3,479)		(3,208)		(253)		(241)		(1,427)		-		(8,608)
Net operating income before  loan impairment charges  and other credit risk  provisions	27,567		11,322		10,041		22,783		9,265		(1,985)		78,993
Loan impairment charges and other credit risk provisions	(2,542)		(231)		(616)		(12,156)		(1,697)		-		(17,242)
Net operating income1	25,025		11,091		9,425		10,627		7,568		(1,985)		61,751
Total operating expenses (excluding depreciation and amortisation)	(15,451)		(3,510)		(4,572)		(10,037)		(5,043)		1,985		(36,628)
Depreciation of property, plant  and equipment	(848)		(180)		(159)		(317)		(210)		-		(1,714)
Amortisation of intangible  assets	(226)		(90)		(33)		(202)		(149)		-		(700)
Total operating expenses	(16,525)		(3,780)		(4,764)		(10,556)		(5,402)		1,985		(39,042)
Operating profit	8,500		7,311		4,661		71		2,166		-		22,709
Share of profit in associates  and joint ventures	95		28		1,348		20		12		-		1,503
Profit before tax	8,595		7,339		6,009		91		2,178		-		24,212

By geographical region (continued)

Profit before tax

	Year ended 31 December 2006
	Europe		Hong Kong		Rest of Asia- Pacific		North America		Latin America		Intra- HSBC items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m
Interest income	25,249		11,097		7,693		27,959		7,289		(3,408)		75,879
Interest expense	(16,960)		(6,412)		(4,646)		(13,691)		(3,092)		3,408		(41,393)
Net interest income	8,289		4,685		3,047		14,268		4,197		-		34,486
Fee income	9,583		2,448		1,912		5,611		1,975		(449)		21,080
Fee expense	(2,475)		(392)		(290)		(845)		(345)		449		(3,898)
Net fee income	7,108		2,056		1,622		4,766		1,630		-		17,182
Trading income excluding net interest income	2,842		924		935		617		301		-		5,619
Net interest income/(expense)  on trading activities	1,687		(307)		246		741		236		-		2,603
Net trading income	4,529		617		1,181		1,358		537		-		8,222
Changes in fair value of long- term debt issued and related derivatives	28		-		-		(63)		-		-		(35)
Net income from other financial instruments designated at fair value	116		260		79		-		237		-		692
Net income/(expense) from financial instruments  designated at fair value	144		260		79		(63)		237		-		657
Gains less losses from financial investments	624		162		41		58		84		-		969
Dividend income	183		61		5		85		6		-		340
Net earned insurance premiums	1,298		2,628		174		492		1,076		-		5,668
Other operating income	1,428		834		765		922		91		(1,494)		2,546
Total operating income	23,603		11,303		6,914		21,886		7,858		(1,494)		70,070
Net insurance claims incurred  and movement in liabilities to policyholders	(531)		(2,699)		(192)		(259)		(1,023)		-		(4,704)
Net operating income before  loan impairment charges  and other credit risk  provisions	23,072		8,604		6,722		21,627		6,835		(1,494)		65,366
Loan impairment charges and other credit risk provisions	(2,155)		(172)		(512)		(6,796)		(938)		-		(10,573)
Net operating income1	20,917		8,432		6,210		14,831		5,897		(1,494)		54,793
Total operating expenses (excluding depreciation and amortisation)	(12,811)		(3,002)		(3,412)		(9,669)		(3,923)		1,494		(31,323)
Depreciation of property, plant  and equipment	(762)		(171)		(124)		(284)		(173)		-		(1,514)
Amortisation of intangible  assets	(298)		(96)		(12)		(240)		(70)		-		(716)
Total operating expenses	(13,871)		(3,269)		(3,548)		(10,193)		(4,166)		1,494		(33,553)
Operating profit	7,046		5,163		2,662		4,638		1,731		-		21,240
Share of profit/(loss) in  associates and joint ventures	(72)		19		865		30		4		-		846
Profit before tax	6,974		5,182		3,527		4,668		1,735		-		22,086

Total assets 

	At 31 December 2008				At 31 December 2007
	US$m		%		US$m		%
Europe	1,343,011		53.1		1,236,633		52.5
Hong Kong	407,151		16.1		356,894		15.2
Rest of Asia-Pacific	262,305		10.4		243,205		10.3
North America	552,612		21.9		549,285		23.3
Latin America	97,944		3.9		101,088		4.3
Intra-HSBC items	(135,558)		(5.4)		(132,839)		(5.6)
	2,527,465		100.0		2,354,266		100.0

Total liabilities 

	At 31 December 2008				At 31 December 2007
	US$m		%		US$m		%
Europe	1,312,922		54.1		1,178,826		53.1
Hong Kong	393,304		16.2		341,519		15.4
Rest of Asia-Pacific	241,674		10.0		225,592		10.2
North America	527,967		21.8		517,516		23.3
Latin America	86,927		3.6		88,236		4.0
Intra-HSBC items	(135,558)		(5.7)		(132,839)		(6.0)
	2,427,236		100.0		2,218,850		100.0

Other disclosures

	Europe		Hong Kong	Rest of Asia- Pacific			North America		Latin America	Intra-HSBC items			Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m
Year ended 31 December 2008
Capital expenditure incurred2	2,078		440		511		726		617		-		4,372
Investment in associates and  joint ventures	137		153		11,111		128		8		-		11,537
1    Net operating income:
External	25,887		8,205		9,396		5,236		8,021		-		56,745
Inter-segment	1,038		1,184		1,122		(852)		-		(2,492)		-
Year ended 31 December 2007
Capital expenditure incurred2	1,722		441		277		833		599		-		3,872
Investment in associates and  joint ventures	158		155		9,867		127		77		-		10,384
1    Net operating income:
External	23,772		10,168		8,456		11,784		7,571		-		61,751
Inter-segment	1,253		923		969		(1,157)		(3)		(1,985)		-
Year ended 31 December 2006
Capital expenditure incurred2	1,508		324		235		899		2,017		-		4,983
Investment in associates and  joint ventures	1,321		128		6,322		541		84		-		8,396
1    Net operating income:
External	19,664		7,970		5,592		15,694		5,873		-		54,793
Inter-segment	1,253		462		618		(863)		24		(1,494)		-

2    Expenditure incurred on property, plant and equipment and intangible assets

By customer groups and global businesses

Total assets 

	US$m		%		US$m		%
Personal Financial Services	514,419		20.4		621,356		26.4
Commercial Banking	249,218		9.9		307,944		13.1
Global Banking and Markets	1,896,630		75.0		1,561,468		66.3
Private Banking	133,216		5.3		130,893		5.6
Other	135,001		5.3		155,685		6.6
Intra-HSBC items	(401,019)		(15.9)		(423,080)		(18.0)
Total assets	2,527,465		100.0		2,354,266		100.0
	At 31 December 2008				At 31 December 2007
	US$m		%		US$m		%
Personal Financial Services	514,419		20.4		621,356		26.4
Commercial Banking	249,218		9.9		307,944		13.1
Global Banking and Markets	1,896,630		75.0		1,561,468		66.3
Private Banking	133,216		5.3		130,893		5.6
Other	135,001		5.3		155,685		6.6
Intra-HSBC items	(401,019)		(15.9)		(423,080)		(18.0)
Total assets	2,527,465		100.0		2,354,266		100.0

Profit before tax 

	Year ended 31 December 2008
	Personal     Financial     Services	Commercial      Banking			Global     Banking     & Markets		Private     Banking		Other		Intra-    HSBC     items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		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)	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 claims incurred  and movement in liabilities  to policyholders	(6,474)		(335)		(79)		-		(1)		-		(6,889)
Net operating income1	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 income2	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
Capital expenditure incurred3	1,901		536		1,115		61		759				4,372
1    Net operating income before loan impairment charges and other credit risk provisions.
2    Net operating income:
External	15,023		13,080		17,739		2,231		8,672		-		56,745
Inter-segment	5,246		64		(5,692)		1,332		3,618		(4,568)		-

• Expenditure incurred on property, plant and equipment and intangible assets.

	Year ended 31 December 2007
	Personal     Financial     Services	Commercial      Banking			Global     Banking     & Markets		Private     Banking		Other		Intra-    HSBC     items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		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 income	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 in 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 claims incurred  and movement in liabilities  to policyholders	(8,147)		(391)		(70)		-		-		-		(8,608)
Net operating income1	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 income2	27,067		12,943		15,172		3,534		6,947		(3,912)		61,751
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
Capital expenditure incurred3	1,335		527		942		73		995		-		3,872
1    Net operating income before loan impairment charges and other credit risk provisions.
2    Net operating income:
External	21,059		11,442		23,595		2,144		3,511		-		61,751
Inter-segment	6,008		1,501		(8,423)		1,390		3,436		(3,912)		-

3    Expenditure incurred on property, plant and equipment and intangible assets.

Profit before tax (continued)

	Year ended 31 December 2006
	Personal     Financial     Services	Commercial      Banking			Global     Banking     & Markets		Private     Banking		Other		Intra-    HSBC     items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		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)	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 claims incurred  and movement in liabilities  to policyholders	(4,365)		(96)		(62)		-		(181)		-		(4,704)
Net operating income1	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 income2	27,895		10,688		13,694		2,898		2,797		(3,179)		54,793
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
Capital expenditure incurred3	2,150		1,083		1,021		45		684		-		4,983
1    Net operating income before loan impairment (charges)/recoveries and other credit risk provisions.
2    Net operating income:
External	23,238		9,692		20,034		1,661		168		-		54,793
Inter-segment	4,657		996		(6,340)		1,237		2,629		(3,179)		-

3    Expenditure incurred on property, plant and equipment and intangible assets.

15    Analysis of financial assets and liabilities by measurement basis

Financial assets and financial liabilities are measured on an ongoing basis either at fair value or at amortised cost. The summary of significant accounting policies in Note 2 describes how the classes of financial instruments are measured, and how income and expenses, including fair value gains and losses, are recognised. The following table analyses the carrying amounts of the financial assets and liabilities by category as defined in IAS 39 and by balance sheet heading.

 

END

 

 

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