HSBC Bank Canada 3Q00 Results

HSBC Hldgs PLC
31 October 2000

                       HSBC BANK CANADA
            THIRD QUARTER 2000 RESULTS - HIGHLIGHTS


*  Net income of C$50 million for the quarter ended 30 September
   2000, an increase of 11.1 per cent over the comparative quarter
   ended 30 September 1999.

*  Return on average common equity of 17.0 per cent for the
   quarter ended 30 September 2000.

*  Total assets of C$29.1 billion at 30 September 2000 (C$25.1
   billion at 31 December 1999).

*  Total capital ratio of 11.0 per cent and tier 1 capital ratio
   of 8.1 per cent at 30 September 2000 (10.9 per cent and 7.9 per
   cent at 31 December 1999).

*  Funds under management of C$12.3 billion at 30 September 2000
   (C$10.2 billion at 31 December 1999).
                                                                

HSBC Bank Canada reports net income of C$50 million

HSBC Bank Canada recorded a net income of C$50 million for the
three months ended 30 September 2000, up 11.1 per cent from the
same quarter in 1999. Net income for the nine months ended 30
September 2000 was C$144 million, up 17.1 per cent over the
same period in 1999. Return on equity was 17.0 per cent for the
three months ended 30 September 2000, compared to 19.4 per cent
in the third quarter of 1999. For the nine months ended 30
September 2000, return on equity was 16.5 per cent compared to
18.7 per cent for the same period in 1999.

Total return on equity ratios for the three months and nine
months ended 30 September 2000 were lower than comparative
periods in 1999 as a result of the increased capital base in
2000. To support strong loan growth in 2000, capital was
retained in the bank. In addition, C$100 million was raised 
through the issuance of additional common shares in August 2000.

The cost:income ratio for the three months ended 30 September
2000 was 63.2 per cent compared to 67.1 per cent in the third
quarter of 1999. For the nine months ended 30 September 2000
the cost:income ratio was 66.6 per cent compared to 68.5 per
cent for the same period in 1999.

Martin Glynn, president and chief executive officer, said: 'Our
results for the quarter were in line with expectations. The
bank continues to experience strong growth in interest earning
assets, particularly commercial loans, and in wealth management
activities.

'The focus on improving operational efficiencies within the
branch network in order to spend more time with customers has
shown encouraging results. Over the last four quarters, we have 
made ourselves more efficient. On a year-to-date basis, the 
cost:income ratio for the nine months ended 30 September 2000 
showed an improvement when compared to the same period in 1999.

'During the third quarter we successfully launched our internet
banking service to all personal clients. This has broadened our
ability to reach customers, providing increased convenience to 
them to meet their changing requirements.

'Looking ahead, we will continue to streamline administrative
processes of our branches and our range of delivery channels.
We have the right people and the strategies in place and I am
confident of our ability to continue delivering value to our
customers.'


HSBC Bank Canada                              Financial Commentary
 

Net interest income

Net interest income for the third quarter of 2000 was C$171
million, an increase of C$35 million, or 25.7 per cent, over
the third quarter of 1999. For the nine months ended 30
September 2000, net interest income was C$487 million, an
increase of C$88 million, or 22.1 per cent, over the
comparative period in 1999. Continued growth in interest
earning loans, especially in commercial advances, helped boost
year-on-year performance. In addition, the acquisition of
Republic National Bank of New York (Canada) ('Republic Canada')
at the beginning of the second quarter this year added C$974
million in loans.

Increases in prime and base lending rates, increased
contribution from loan fees and lower funding costs helped
boost the net interest margin, as a percentage of average
interest earning assets, to 2.67 per cent in the third quarter
of 2000 compared to 2.31 per cent for the comparable period in
1999. On a year-to-date basis, the net interest margin for 2000
was 2.67 per cent compared to 2.29 per cent in 1999. The lower
funding costs were primarily due to less reliance being placed
on wholesale deposits, which are more costly than personal
retail deposits, in 2000 compared to 1999. In addition, the
capital restructuring in December 1999 eliminated C$4 million
of subordinated interest expense per quarter in 2000.

Other income

Other income was C$106 million in the third quarter of 2000, an
increase of C$11 million, or 11.6 per cent, over the third
quarter of 1999. For the nine months ended 30 September 2000,
other income was C$349 million, an increase of C$60 million, or
20.8 per cent, over the comparative period in 1999. Funds under
management increased 40.0 per cent from the third quarter of
1999 to C$12.3 billion at 30 September 2000. This growth,
combined with increased corporate finance fees, boosted
investment and securities services revenue to C$163 million for
the nine months ended 30 September 2000, an increase of C$61
million over the same period in 1999.

Favourable market conditions improved investment and securities
services income in the first and second quarters of 2000.
However, a slowdown in equity markets in the third quarter had
a slightly negative impact on other income. Investment and
securities services income was C$43 million for the three
months ended 30 September 2000 compared to C$52 million for the
three months ended 30 June 2000. Trading revenue for the nine
months ended 30 September 2000 was lower than the comparative
period in 1999 due to a lower contribution from the structured
equity trading operations.


Non-interest expenses

Non-interest expenses were C$177 million in the quarter ended
30 September 2000 compared to C$155 million for the same period
in 1999. For the nine months ended 30 September 2000, non-
interest expenses were C$562 million, an increase of C$90
million over the comparative period in 1999. The higher
salaries and employee benefits and other non-interest expenses
were due to the growth in performance-based compensation and
volume-driven transaction expenses. Both of these expense items
are associated with the increases in other income. The
percentage growth in total revenue was higher than the
percentage growth in expenses. As a result, the cost:income
ratio, excluding amortisation of goodwill and intangible
assets, improved 390 basis points for the quarter ended 30
September 2000 compared to the same quarter in 1999.

Credit quality and provision for credit losses

The provision for credit losses was C$10 million for the third
quarter of 2000 and C$32 million for the nine months ended 30
September 2000. This compared to C$7 million and C$35 million,
respectively, for the same periods in 1999. Despite an increase
in the overall volume of interest earning assets, credit
quality remains strong. The provision for credit losses as a
percentage of average loans and bankers acceptances has
improved 4 basis points to 0.20 per cent for the nine months
ended 30 September 2000 compared to the same period in 1999.
The allowance for credit losses exceeded gross impaired loans
by C$122 million at 30 September 2000 compared to C$83 million
at 30 September 1999.

Balance sheet

Total assets at 30 September 2000 were C$29.1 billion, up C$3.5
billion, or 14.0 per cent, from 30 September 1999. Loans
increased by C$2.3 billion, of which approximately C$1.0
billion was from the acquisition of Republic Canada. This
increase, primarily in commercial accounts combined with an
increase in bankers' acceptances of C$0.6 billion, reflected
the strong Canadian economy.

Capital

The bank's tier 1 capital ratio was 8.1 per cent and the total
capital ratio was 11.0 per cent as at 30 September 2000. In
August 2000, the bank issued additional common shares for cash
proceeds of C$100 million. This was used for general corporate
purposes.

Dividends

At its meeting on 27 October 2000, the Board of Directors
declared a regular dividend on the class 1 preferred shares -
series A, payable on 31 December 2000 for shareholders of
record on 15 December 2000. The dividend will be paid in cash
on 2 January 2001.


Shareholder information

HSBC Bank Canada, an indirectly-held, wholly-owned subsidiary
of HSBC Holdings plc, has more than 150 offices. With over
6,000 offices in 81 countries and territories and assets of
US$580 billion at 30 June 2000, the HSBC Group is one of the
world's largest banking and financial services organisations.

Copies of the Interim Report will be sent to shareholders
during November 2000.

This news release may contain forward-looking statements,
including statements regarding the business and anticipated
financial performance of HSBC Bank Canada. These statements are
subject to a number of risks and uncertainties that may cause
actual results to differ materially from those contemplated by
the forward-looking statements. Some of the factors that could
cause such differences include legislative or regulatory
developments, competition, technological change, global capital
market activity, changes in government monetary and economic
policies, changes in prevailing interest rates, inflation
levels and general economic conditions in geographic areas
where HSBC Bank Canada operates.

HSBC Bank Canada                                            Highlights

                              Quarter ended           Nine months ended  
Figures in C$            30 Sept    30 June    30 Sept    30 Sept   30 Sept
millions                    2000       2000       1999       2000      1999 
(except per share
amounts)                                                                 
                                                                              
                                                                   
Earnings                                                                
Net interest income          171        164        136        487       399 
Net income                    50         47         45        144       123 
Basic earnings per common                                                  
  share                     0.15       0.13       0.16       0.44      0.44 
                                                                           
Financial ratios (%)                                                       
Return on average common                                                   
  equity ^                  17.0       13.6       19.4       16.5     18.73 
Return on average assets    0.65       0.52       0.67       0.60      0.62 
Net interest margin         2.67       2.69       2.31       2.67      2.29 
Efficiency ratio ^^         63.2       68.1       67.1       66.6      68.5 
Provision for credit                                                       
  losses/average loans                                                     
  and acceptances           0.18       0.21       0.14       0.20      0.24 
Other income/total income   38.3       41.8       41.1       41.7      42.0 
                                                                           
^  After declaration of a dividend on class 2 preferred shares series A
of C$11 million in June 2000. If the dividend had been declared on a
quarterly basis, return on average common equity for the quarter ended
30 June 2000 would have been 15.9 per cent and basic earnings per share
would have been C$0.15.
^^  Excluding amortisation of goodwill and intangible assets.

                                             At 30      At 31         At 30 
                                         Sept 2000   Dec 1999     Sept 1999
Figures in C$ millions                    
                                                                          
Financial position                                                        
Total assets                                29,147     25,051        25,563 
Total loans                                 19,577     17,130        17,266 
Total deposits                              23,043     20,170        20,656 
Shareholders' equity                         1,331      1,252           940 
                                                                          
Assets under administration                                               
Funds under management                      12,278     10,227         8,771 
Custodial assets under                                                     
  administration                             2,585      2,786         2,460 
                                                                          
Capital ratios (%)                                                        
Total capital                                 11.0       10.9          10.3 
Tier 1 capital                                 8.1        7.9           5.9 


HSBC Bank Canada         Consolidated Statement of Income (Unaudited)

                                                                         
                               Quarter ended          Nine months ended  
Figures in C$                                                             
millions               
(except share and per                
share amounts)             30 Sept     30 June   30 Sept   30 Sept    30 Sept
                              2000        2000      1999      2000       1999 
                                                                             
Interest and dividend                                                        
income                                                                       
Loans                          375         347       295     1,026        881 
Other                           89          81        79       254        236 
                               464         428       374     1,280      1,117 
                                                                             
Interest expense                                                             
Deposits                     (285)       (257)      (228)     (771)      (687)
Debentures                     (8)         (7)       (10)      (22)       (31)
                             (293)       (264)      (238)     (793)      (718)
                                                                             
Net interest income           171         164        136       487        399 
                                                                             
Provision for credit                                                         
  losses                      (10)        (11)        (7)      (32)      (35)
Net interest income                                                          
  after provision for                                                        
  credit losses               161         153        129       455       364 
Other income                  106         118         95       349       289 
                                                                             
Net interest and                                                             
  other income                267         271        224       804       653 
                                                                             
Non-interest expenses                                                        
Salaries and employee                                                        
  benefits                    (92)       (100)       (84)     (293)     (251)
Premises and                                                                 
  equipment                   (26)        (29)       (25)      (83)      (77)
Other                         (59)        (65)       (46)     (186)     (144)
Total non-interest                                                            
  expenses                   (177)       (194)      (155)     (562)     (472)
                                                                             
Net income before                                                            
  taxes and                                                                   
  minority interest            90          77         69       242       181 
Provision for income                                                       
  taxes                       (36)        (30)       (24)      (94)      (58)
Minority interest              (4)         -          -         (4)       - 
Net income                     50          47         45       144       123 
Preferred share                (2)        (11)        -        (13)       - 
dividends
                                                                              
                                                                            
Net income                                                                  
  attributable to                                                         
  common shares                48          36         45       131       123 
                                                                          
Average common shares                                                     
  outstanding (000s)      322,559     280,168    280,168   294,402   280,168 
Basic earnings per                                                         
  share                      0.15        0.13       0.16      0.44      0.44 



                                   At 30 Sept    At Dec     At Sept
  Figures in C$                          2000      1999        1999 
  millions
                                                                    
  Assets                                                            
                                                                    
  Cash and deposits with Bank                                       
    of Canada                             376       341         198 
  Deposits with regulated                                          
    financial institutions              1,683     1,954       2,434  
                                        2,059     2,295       2,632 
                                                                    
  Investment securities                 3,113     2,437       2,439 
  Trading securities                      373       410         502 
                                        3,486     2,847       2,941 
                                                                    
  Assets purchased under                                            
    reverse                                                         
    repurchase agreements                 543       378         430 
                                                                    
  Loans                                                             
    Businesses and government          11,431     9,634       9,422 
    Residential mortgage                6,427     5,769       6,156 
    Consumer                            2,003     2,014       2,007 
    Allowance for credit                                            
     losses                              (284)     (287)       (319)
                                       19,577     17,130      17,266 
                                                                    
  Customers' liability under                                        
    acceptances                         2,201      1,705       1,594 
  Other assets                          1,281        696         700 
                                        3,482      2,401       2,294 
  Total assets                         29,147     25,051      25,563 
                                                                    
  Liabilities and shareholders' equity                              
                                                                    
  Deposits                                                          
  -  Regulated financial                  625      1,303       1,707 
    institutions                                                    
  -  Individuals                       11,862     10,858      10,837 
  -  Businesses and                                                 
      governments                      10,556      8,009       8,112 
                                       23,043     20,170      20,656 
                                                                    
  Acceptances                           2,201      1,705       1,594 
  Assets sold under                                                 
    repurchase agreements                  99        179         226 
  Other liabilities                     1,821      1,323       1,503 
  Subordinated debt                       422        392         614 
  Minority interests                      230         30          30 
                                        4,773      3,629       3,967 
                                                                    
  Shareholders' equity                                              
  -  Preferred shares                     125        270           - 
  -  Common shares                        175         75          75 
  -  Contributed surplus                  165        165         165 
  -  Retained earnings                    866        742         700 
                                        1,331      1,252         940 
                                                                    
  Total liabilities and                                             
  shareholders' equity                 29,147     25,051      25,563 

  HSBC Bank Canada          Condensed Consolidated Statement of Cash Flows
                                                                (Unaudited)
  

                              Quarter ended           Nine months ended 
                        30 Sept    30 June    30 Sept    30 Sept    30 Sept 
                           2000       2000       1999       2000       1999 
  Figures in C$           
  millions
                                                                            
  Cash flows (used in)                                                      
   from operating          
   activities               (37)       (14)       197         82        240
   
                                                                            
  Cash flows from                                                           
    financing activities    862         84        282      1,894         19
                                                                            
  Cash flows (used in)                                                      
   from investing         
   activities              (319)    (1,247)       740     (2,077)       650
                                                                            
  Increase (decrease)                                                       
    in cash and cash          
    equivalents             506     (1,177)     1,219       (101)       909
  Cash and cash                                                             
    equivalents,            
    beginning of period   1,485      2,662      1,126      2,092      1,436
  Cash and cash                                                             
    equivalents, end of  
    period                1,991      1,485      2,345      1,991      2,345