HSBC Holdings plc pt 4/4
HSBC Holdings PLC
03 March 2008
Other
Half-year to Half-year to
30Jun07 31Dec07 2007 30Jun06 31Dec06 2006
US$m US$m US$m US$m US$m US$m
Net interest income/(expense) (291) (251) (542) (292) (333) (625)
Net fee income/(expense) (7) (221) (228) 25 147 172
Net trading income/(expense) (49) 175 126 (68) (78) (146)
Net income/(expense) from financial instruments
designated at fair value 91 2,802 2,893 133 (214) (81)
Gains less losses from financial investments 101 (18) 83 107 40 147
Gains arising from dilution of interests in
associates 1,076 16 1,092 - - -
Dividend income 27 5 32 61 2 63
Net earned insurance premiums (9) (12) (21) 148 59 207
Other operating income 1,667 1,856 3,523 1,544 1,710 3,254
Total operating income 2,606 4,352 6,958 1,658 1,333 2,991
Net insurance claims incurred and movement
in liabilities to policyholders - - - (101) (80) (181)
Net operating income before loan impairment
charges and other credit risk provisions 2,606 4,352 6,958 1,557 1,253 2,810
Loan impairment charges and other credit
risk provisions (2) (9) (11) (1) (12) (13)
Net operating income 2,604 4,343 6,947 1,556 1,241 2,797
Net operating expenses (1,650) (1,912) (3,562) (1,573) (1,686) (3,259)
Operating profit 954 2,431 3,385 (17) (445) (462)
Share of profit in associates and
joint ventures 116 34 150 20 54 74
Profit/(loss) before tax 1,070 2,465 3,535 3 (391) (388)
10. Geographical distribution of results
Europe
Half-year to Half-year to
30Jun07 31Dec07 2007 30Jun06 31Dec06 2006
US$m US$m US$m US$m US$m US$m
Interest income 15,217 17,927 33,144 11,765 13,484 25,249
Interest expense (11,297) (14,101) (25,398) (7,671) (9,289) (16,960)
Net interest income 3,920 3,826 7,746 4,094 4,195 8,289
Fee income 5,382 5,591 10,973 4,874 4,709 9,583
Fee expense (1,238) (1,304) (2,542) (1,361) (1,114) (2,475)
Net fee income 4,144 4,287 8,431 3,513 3,595 7,108
Net trading income 3,338 3,605 6,943 2,187 2,342 4,529
Net income from financial instruments
designated at fair value 348 878 1,226 129 15 144
Gains less losses from financial investments 790 536 1,326 266 358 624
Dividend income 161 10 171 121 62 183
Net earned insurance premiums 1,480 2,530 4,010 668 630 1,298
Other operating income 262 931 1,193 633 795 1,428
Total operating income 14,443 16,603 31,046 11,611 11,992 23,603
Net insurance claims incurred and movement
in liabilities to policyholders (1,146) (2,333) (3,479) (287) (244) (531)
Net operating income before loan impairment
charges and other credit risk provisions 13,297 14,270 27,567 11,324 11,748 23,072
Loan impairment charges and other credit
risk provisions (1,363) (1,179) (2,542) (935) (1,220) (2,155)
Net operating income 11,934 13,091 25,025 10,389 10,528 20,917
Net operating expenses (7,972) (8,553) (16,525) (6,723) (7,148) (13,871)
Operating profit 3,962 4,538 8,500 3,666 3,380 7,046
Share of profit/(loss) in associates and
joint ventures 88 7 95 (66) (6) (72)
Profit before tax 4,050 4,545 8,595 3,600 3,374 6,974
Hong Kong
Interest income 6,214 6,366 12,580 5,207 5,890 11,097
Interest expense (3,646) (3,451) (7,097) (3,049) (3,363) (6,412)
Net interest income 2,568 2,915 5,483 2,158 2,527 4,685
Fee income 1,659 2,201 3,860 1,197 1,251 2,448
Fee expense (220) (278) (498) (197) (195) (392)
Net fee income 1,439 1,923 3,362 1,000 1,056 2,056
Net trading income 469 773 1,242 306 311 617
Net income from financial instruments
designated at fair value 210 466 676 6 254 260
Gains less losses from financial investments 32 62 94 122 40 162
Dividend income 17 14 31 59 2 61
Net earned insurance premiums 1,426 1,371 2,797 1,317 1,311 2,628
Other operating income 413 432 845 443 391 834
Total operating income 6,574 7,956 14,530 5,411 5,892 11,303
Net insurance claims incurred and movement
in liabilities to policyholders (1,512) (1,696) (3,208) (1,193) (1,506) (2,699)
Net operating income before loan impairment
charges and other credit risk provisions 5,062 6,260 11,322 4,218 4,386 8,604
Loan impairment charges and other credit
risk provisions (80) (151) (231) (70) (102) (172)
Net operating income 4,982 6,109 11,091 4,148 4,284 8,432
Net operating expenses (1,665) (2,115) (3,780) (1,504) (1,765) (3,269)
Operating profit 3,317 3,994 7,311 2,644 2,519 5,163
Share of profit in associates and
joint ventures 13 15 28 10 9 19
Profit before tax 3,330 4,009 7,339 2,654 2,528 5,182
Rest of Asia-Pacific (including Middle East)
Interest income 4,662 5,496 10,158 3,548 4,145 7,693
Interest expense (2,761) (3,254) (6,015) (2,069) (2,577) (4,646)
Net interest income 1,901 2,242 4,143 1,479 1,568 3,047
Fee income 1,174 1,535 2,709 949 963 1,912
Fee expense (164) (299) (463) (164) (126) (290)
Net fee income 1,010 1,236 2,246 785 837 1,622
Net trading income 797 846 1,643 551 630 1,181
Net income/(expense) from financial instruments
designated at fair value 78 33 111 (5) 84 79
Gains less losses from financial investments 26 12 38 27 14 41
Gains arising from dilution of interests
in associates 1,076 5 1,081 - - -
Dividend income 4 4 8 - 5 5
Net earned insurance premiums 109 117 226 89 85 174
Other operating income 360 438 798 288 477 765
Total operating income 5,361 4,933 10,294 3,214 3,700 6,914
Net insurance claims incurred and movement
in liabilities to policyholders (141) (112) (253) (63) (129) (192)
Net operating income before loan impairment
charges and other credit risk provisions 5,220 4,821 10,041 3,151 3,571 6,722
Loan impairment charges and other credit
risk provisions (308) (308) (616) (271) (241) (512)
Net operating income 4,912 4,513 9,425 2,880 3,330 6,210
Net operating expenses (2,075) (2,689) (4,764) (1,609) (1,939) (3,548)
Operating profit 2,837 1,824 4,661 1,271 1,391 2,662
Share of profit in associates and
joint ventures 507 841 1,348 386 479 865
Profit before tax 3,344 2,665 6,009 1,657 1,870 3,527
North America
Interest income 14,958 15,225 30,183 13,514 14,445 27,959
Interest expense (7,651) (7,685) (15,336) (6,518) (7,173) (13,691)
Net interest income 7,307 7,540 14,847 6,996 7,272 14,268
Fee income 3,307 3,426 6,733 2,702 2,909 5,611
Fee expense (403) (520) (923) (390) (455) (845)
Net fee income 2,904 2,906 5,810 2,312 2,454 4,766
Net trading income/(expense) 622 (1,164) (542) 959 399 1,358
Net income/(expense) from financial instruments
designated at fair value 81 1,669 1,750 24 (87) (63)
Gains less losses from financial investments 53 192 245 40 18 58
Dividend income 64 41 105 39 46 85
Net earned insurance premiums 231 218 449 238 254 492
Other operating income 342 18 360 365 557 922
Total operating income 11,604 11,420 23,024 10,973 10,913 21,886
Net insurance claims incurred and movement
in liabilities to policyholders (124) (117) (241) (117) (142) (259)
Net operating income before loan impairment
charges and other credit risk provisions 11,480 11,303 22,783 10,856 10,771 21,627
Loan impairment charges and other credit
risk provisions (3,820) (8,336) (12,156) (2,172) (4,624) (6,796)
Net operating income 7,660 2,967 10,627 8,684 6,147 14,831
Net operating expenses (5,235) (5,321) (10,556) (4,974) (5,219) (10,193)
Operating profit/(loss) 2,425 (2,354) 71 3,710 928 4,638
Share of profit/(loss) in associates and joint
ventures 10 10 20 31 (1) 30
Profit/(loss) before tax 2,435 (2,344) 91 3,741 927 4,668
Latin America
Interest income 4,376 5,095 9,471 3,497 3,792 7,289
Interest expense (1,842) (2,053) (3,895) (1,493) (1,599) (3,092)
Net interest income 2,534 3,042 5,576 2,004 2,193 4,197
Fee income 1,234 1,413 2,647 933 1,042 1,975
Fee expense (236) (258) (494) (163) (182) (345)
Net fee income 998 1,155 2,153 770 860 1,630
Net trading income 285 263 548 258 279 537
Net income from financial instruments
designated at fair value 157 163 320 106 131 237
Gains less losses from financial investments 98 155 253 38 46 84
Gains arising from dilution of interests
in associates - 11 11
Dividend income 6 3 9 3 3 6
Net earned insurance premiums 731 863 1,594 522 554 1,076
Other operating income 153 75 228 41 50 91
Total operating income 4,962 5,730 10,692 3,742 4,116 7,858
Net insurance claims incurred and
movement in liabilities to policyholders (676) (751) (1,427) (489) (534) (1,023)
Net operating income before loan impairment
charges and other credit risk provisions 4,286 4,979 9,265 3,253 3,582 6,835
Loan impairment charges and other credit
risk provisions (775) (922) (1,697) (442) (496) (938)
Net operating income 3,511 4,057 7,568 2,811 3,086 5,897
Net operating expenses (2,516) (2,886) (5,402) (1,946) (2,220) (4,166)
Operating profit 995 1,171 2,166 865 866 1,731
Share of profit in associates and joint ventures 5 7 12 - 4 4
Profit before tax 1,000 1,178 2,178 865 870 1,735
11. Registers of shareholders
The Overseas Branch Registers of shareholders in Hong Kong and Bermuda will be
closed for one day, on Tuesday 25 March 2008. Any person who has acquired shares
registered on the Hong Kong Branch Register but who has not lodged the share
transfer with the Hong Kong Branch Registrar should do so before 4.00pm on
Thursday 20 March 2008 and any person who has acquired shares registered on the
Bermuda Branch Register but who has not lodged the share transfer with the
Bermuda Branch Registrar should do so before 4.00pm on Monday 24 March 2008 in
order to receive the fourth interim dividend for 2007, which will be payable on
Wednesday 7 May 2008. Transfers may not be made to or from the Hong Kong or
Bermuda Overseas Branch Registers while those Branch Registers are closed.
Any person who has acquired shares registered on the Principal Register in the
United Kingdom but who has not lodged the share transfer with the Principal
Registrar should do so before 4.00pm on Tuesday 25 March 2008 in order to
receive the dividend.
Transfers of American Depositary Shares should be lodged with the depositary by
12 noon on Tuesday 25 March 2008 in order to receive the dividend.
12. Foreign currency amounts
The sterling and Hong Kong dollar equivalent figures in the consolidated income
statement and balance sheet are for information only. These are translated at
the average rate for the period for the income statement and the closing rate
for the balance sheet as follows:
Year ended
31Dec07 31Dec06
Closing : HK$/US$ 7.798 7.776
£/US$ 0.498 0.509
Average : HK$/US$ 7.801 7.769
£/US$ 0.500 0.543
13. Litigation
HSBC is party to legal actions in a number of jurisdictions including the UK,
Hong Kong and the US, arising out of its normal business operations. HSBC
considers that none of the actions is material, and none is expected to result
in a significant adverse effect on the financial position of HSBC, either
individually or in the aggregate. Management believes that adequate provisions
have been made in respect of such litigation. HSBC has not disclosed any
contingent liability associated with these legal actions because it is not
practicable to do so, except as set out below.
On 27th July 2007, the UK Office of Fair Trading ('OFT') issued High Court legal
proceedings against a number of UK financial institutions, including HSBC Bank
plc, to determine the legal status and enforceability of certain of the charges
applied to their personal customers in relation to unauthorised overdrafts (the
'charges'). Certain preliminary issues in these proceedings were heard in a
trial in the Commercial Division of the High Court on 17th January 2008. This
trial concluded on 8th February 2008 and judgment, on the preliminary issues
tested, is awaited.
The proceedings remain at a very early stage and may, if appeals on the
preliminary issues (or, subsequently, on substantive issues) are pursued, take a
number of years to conclude. A wide range of outcomes is possible, depending,
initially, upon whether the Court finds that some, all, or none of the charges
should be tested for fairness and/or tested as common law penalties and, if it
does find that some or all of the charges should be so tested, upon the Court's
subsequent assessment of each charge across the period under review. Since July
2001, there have been a variety of charges applied by HSBC Bank plc across
different charging periods under the then current contractual arrangements. HSBC
Bank plc considers the charges to be and to have been valid and enforceable, and
intends strongly to defend its position.
If, contrary to HSBC Bank plc's current assessment, the Court should ultimately
(after appeals) reach a decision adverse to HSBC Bank plc that results in
liability for it, a large number of different outcomes is possible, each of
which would have a different financial impact. Based on the facts currently
available to it, and a number of assumptions, HSBC Bank plc estimates that the
financial impact could be approximately US$600 million. To make an estimate of
the potential financial impact at this stage with any precision is extremely
difficult, owing to (among other things) the complexity of the issues, the
number of permutations of possible outcomes, and the early stage of the
proceedings. In addition, the assumptions made by HSBC Bank plc may prove to be
incorrect.
14. Dealings in HSBC Holdings plc shares
Except for dealings as intermediaries by HSBC Bank plc, HSBC Financial Products
(France) and The Hongkong and Shanghai Banking Corporation Limited, which are
members of a European Economic Area exchange, neither HSBC Holdings nor any
subsidiaries has bought, sold or redeemed any securities of HSBC Holdings during
the year ended 31 December 2007.
15. Statutory accounts
The information in this news release does not constitute statutory accounts
within the meaning of Section 240 of the Companies Act 1985 (the Act). The
statutory accounts for the year ended 31 December 2007 will be delivered to the
Registrar of Companies in England and Wales in accordance with Section 242 of
the Act. The auditor has reported on those accounts. Its report was unqualified
and did not contain a statement under Section 237(2) or (3) of the Act.
16. Forward-looking statements
This news release contains certain forward-looking statements with respect to
the financial condition, results of operations and business of HSBC. These
forward-looking statements represent HSBC's expectations or beliefs concerning
future events and involve known and unknown risks and uncertainty that could
cause actual results, performance or events to differ materially from those
expressed or implied in such statements. Certain statements, such as those that
include the words 'potential', 'estimated', and similar expressions or
variations on such expressions may be considered 'forward-looking statements'.
17. Corporate governance
HSBC is committed to high standards of corporate governance. HSBC Holdings plc
has complied throughout 2007 with the applicable code provisions of the Combined
Code on Corporate Governance issued by the Financial Reporting Council and the
Code on Corporate Governance Practices in Appendix 14 to the Rules Governing the
Listing of Securities on The Stock Exchange of Hong Kong Limited.
The Board of HSBC Holdings plc has adopted a code of conduct for transactions in
HSBC Group securities by Directors that complies with The Model Code in the
Listing Rules of the Financial Services Authority and with The Model Code for
Securities Transactions by Directors of Listed Issuers ('Hong Kong Model Code')
set out in the Rules Governing the Listing of Securities on The Stock Exchange
of Hong Kong Limited save that The Stock Exchange of Hong Kong has granted
certain waivers from strict compliance with the Hong Kong Model Code, primarily
to take into account accepted practices in the UK, particularly in respect of
employee share plans. Following a specific enquiry, each Director has confirmed
he or she has complied with the code of conduct for transactions in HSBC Group
securities throughout 2007.
The Directors of HSBC Holdings plc as at the date of this announcement are:
S K Green, Baroness Dunn*, Sir Brian Moffat*, M F Geoghegan, Lord Butler*, V H C
Cheng, J D Coombe+, J L Duran+, R A Fairhead+, D J Flint, W K L Fung*, J W J
Hughes-Hallett+, W S H Laidlaw+, Sir Mark Moody-Stuart+, G Morgan+, S W Newton+,
S M Robertson+ and Sir Brian Williamson+.
* Non-executive Director
+ Independent non-executive Director
The Group Audit Committee has reviewed the annual results for 2007.
18. Annual Review and Annual Report and Accounts
The Annual Review 2007 and/or Annual Report and Accounts 2007 will be mailed to
shareholders on or about Thursday 3 April 2008. Copies may be obtained from
Group Communications, HSBC Holdings plc, 8 Canada Square, London E14 5HQ, United
Kingdom; Group Communications (Asia), The Hongkong and Shanghai Banking Corporation
Limited, 1 Queen's Road Central, Hong Kong; Internal Communications, HSBC -
North America, 26525 N Riverwoods Boulevard, Mattawa, Illinois, 60045,USA;
Direction de la Communication, HSBC France, 103 avenue des Champs Elysees, 75419
Paris Cedex 08, France; or from the HSBC Group website - www.hsbc.com.
Chinese translations of the Annual Review and Annual Report and Accounts may be
obtained on request from Computershare Hong Kong Investor Services Limited,
Hopewell Centre, Rooms 1806-07, 18th Floor, 183 Queen's Road East, Hong Kong.
A French translation of the Annual Review may be obtained on request from HSBC
France, Direction de la Communication, 103 avenue des Champs Elysees, 75419
Paris Cedex 08, France.
The Annual Report and Accounts will be filed with the United States Securities
and Exchange Commission.
The Annual Review and Annual Report and Accounts will be available on the Stock
Exchange of Hong Kong's website - www.hkex.com.hk.
Custodians or nominees that wish to distribute copies of the Annual Review and/
or Annual Report and Accounts to their clients may request copies for collection
by writing to Group Communications at the address given above. Custodians and
nominees will need to request copies of the Annual Review 2007 and/or Annual
Report and Accounts 2007 no later than 10 March 2008.
19. Annual General Meeting
The Annual General Meeting of the Company will be held at the Barbican Hall,
Barbican Centre, London EC2 on Friday 30 May 2008 at 11 am.
Notice of the meeting will be mailed to shareholders on or about Thursday 3
April 2008.
20. Interim results for 2008
The interim results for the six months to 30 June 2008 will be announced on
Monday 4 August 2008.
21. Proposed interim dividends for 2008
The Board has adopted a policy of paying quarterly dividends. Under this policy
it is intended to have a pattern of three equal interim dividends with a
variable fourth interim dividend. It is envisaged that the first interim
dividend in respect of 2008 will be US$0.18 per ordinary share. The proposed
timetables for the dividends in respect of 2008 are:
Interim dividends on the ordinary shares for 2008
First Second Third Fourth
Announcement 6 May 2008 4 August 2008 3 November 2008 2 March 2009
ADSs quoted ex-dividend in
New York 21 May 2008 20 August 2008 19 November 2008 18 March 2009
Shares quoted ex-dividend in
London, Hong Kong and Bermuda 21 May 2008 20 August 2008 19 November 2008 18 March 2009
Record date and closure of
Hong Kong Overseas Branch
register of shareholders for
one day 23 May 2008 22 August 2008 21 November 2008 20 March 2009
Shares quoted ex-dividend
in Paris 26 May 2008 25 August 2008 24 November 2008 23 March 2009
Payment date 9 July 2008 8 October 2008 14 January 2009 6 May 2009
22. News release
Copies of this news release may be obtained from Group Comunications, HSBC
Holdings plc, 8 Canada Square, London E14 5HQ, United Kingdom; Group
Communications (Asia) The Hongkong and Shanghai Banking Corporation Limited,
1 Queen's Road Central, Hong Kong; Group Public Affairs, HSBC Bank USA, N.A.,
452 Fifth Avenue, New York, NY 10018, USA; Direction de la Communication,
HSBC France, 103 avenue des Champs Elysees, 75419 Paris Cedex 08, France.
The news release will also be available on the HSBC Group website - www.hsbc.com.
23. For further information contact:
London Hong Kong
Richard Beck David Hall
Group Communications Director Head of Group Communications (Asia)
Telephone: +44 (0)20 7991 0633 Telephone: +852 2822 1133
Danielle Neben Gareth Hewett
Manager Investor Relations Senior Manager, External Relations
Telephone: +44 (0)20 7992 1938 Telephone: +852 2822 4929
Chicago Paris
Lisa Sodeika Chantal Nedjib
Executive Vice President, Managing Director, Corporate Communications
Corporate Affairs Telephone: +33 1 40 70 7729
Telephone: +1 847 564 6394
Linda Recupero Gilberte Lombard
Executive Vice President, Investor Relations Director
Group Public Affairs Telephone: +33 1 40 70 2257
Telephone: +1 212 525 3800
This information is provided by RNS
The company news service from the London Stock Exchange
Friday, 22nd November 2024
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