Summary ................................................................... |
41 |
Europe ...................................................................... |
42 |
Hong Kong ............................................................... |
49 |
Rest of Asia-Pacific .................................................. |
55 |
Middle East and North Africa .................................... |
62 |
North America .......................................................... |
68 |
Latin America ........................................................... |
74 |
|
Half-year to |
||||||||||
|
30 June 2011 |
|
30 June 2010 |
|
31 December 2010 |
||||||
|
US$m |
|
% |
|
US$m |
|
% |
|
US$m |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
Europe ...................................................... |
2,147 |
|
18.7 |
|
3,521 |
|
31.7 |
|
781 |
|
9.8 |
Hong Kong ............................................... |
3,081 |
|
26.9 |
|
2,877 |
|
25.9 |
|
2,815 |
|
35.5 |
Rest of Asia-Pacific .................................. |
3,742 |
|
32.6 |
|
2,985 |
|
26.9 |
|
2,917 |
|
36.8 |
Middle East and North Africa ................... |
747 |
|
6.5 |
|
346 |
|
3.1 |
|
546 |
|
6.9 |
North America ......................................... |
606 |
|
5.3 |
|
492 |
|
4.4 |
|
(38) |
|
(0.5) |
Latin America ........................................... |
1,151 |
|
10.0 |
|
883 |
|
8.0 |
|
912 |
|
11.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
11,474 |
|
100.0 |
|
11,104 |
|
100.0 |
|
7,933 |
|
100.0 |
|
At 30 June 2011 |
|
At 30 June 2010 |
|
At 31 December 2010 |
||||||
|
US$m |
% |
|
US$m |
|
% |
|
US$m |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe ...................................................... |
1,379,308 |
|
51.2 |
|
1,280,698 |
|
52.9 |
|
1,249,527 |
|
50.9 |
Hong Kong ............................................... |
474,044 |
|
17.6 |
|
410,991 |
|
17.0 |
|
429,565 |
|
17.5 |
Rest of Asia-Pacific .................................. |
298,590 |
|
11.1 |
|
244,624 |
|
10.1 |
|
278,062 |
|
11.3 |
Middle East and North Africa ................... |
58,038 |
|
2.2 |
|
49,637 |
|
2.1 |
|
52,757 |
|
2.1 |
North America ......................................... |
529,386 |
|
19.7 |
495,408 |
|
20.5 |
|
492,487 |
|
20.1 |
|
Latin America ........................................... |
163,611 |
|
6.1 |
|
121,885 |
|
5.0 |
|
139,938 |
|
5.7 |
Intra-HSBC items ..................................... |
(211,990) |
|
(7.9) |
|
(184,789) |
|
(7.6) |
|
(187,647) |
|
(7.6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
2,690,987 |
|
100.0 |
|
2,418,454 |
|
100.0 |
|
2,454,689 |
|
100.0 |
|
At 30 June 2011 |
|
At 31 December 2010 |
||||
|
US$bn |
% |
|
US$bn |
|
% |
|
|
|
|
|
|
|
|
|
Total .................................................................................................... |
1,168.5 |
|
|
|
1,103.1 |
|
|
|
|
|
|
|
|
|
|
Europe .................................................................................................. |
315.7 |
|
26.9 |
|
301.6 |
|
27.2 |
Hong Kong ........................................................................................... |
110.8 |
|
9.5 |
|
106.9 |
|
9.7 |
Rest of Asia-Pacific .............................................................................. |
241.1 |
|
20.6 |
|
217.5 |
|
19.6 |
Middle East and North Africa ................................................................ |
58.1 |
|
5.0 |
|
54.1 |
|
4.9 |
North America ...................................................................................... |
335.8 |
|
28.6 |
|
330.7 |
|
29.9 |
Latin America ....................................................................................... |
110.5 |
|
9.4 |
|
95.9 |
|
8.7 |
For footnotes, see page 81.
Our principal banking operations in Europe are HSBC Bank plc in the UK, HSBC France, HSBC Bank A.S. in Turkey, HSBC Bank Malta p.l.c., HSBC Private Bank (Suisse) S.A. and HSBC Trinkaus & Burkhardt AG. Through these operations we provide a wide range of banking, treasury and financial services to personal, commercial and corporate customers across Europe. |
|||||
|
Half-year to |
||||
|
30 Jun |
|
30 Jun |
|
31 Dec |
|
2011 |
|
2010 |
|
2010 |
|
US$m |
|
US$m |
|
US$m |
|
|
|
|
|
|
Net interest income ...... |
5,566 |
|
5,802 |
|
5,448 |
Net fee income ............. |
3,131 |
|
3,177 |
|
3,194 |
Net trading income ....... |
2,007 |
|
1,604 |
|
1,259 |
Other income/(expense) |
636 |
|
2,138 |
|
128 |
|
|
|
|
|
|
Net operating income41 ................................... |
11,340 |
|
12,721 |
|
10,029 |
|
|
|
|
|
|
Impairment charges42 .... |
(1,173) |
|
(1,501) |
|
(1,519) |
|
|
|
|
|
|
Net operating income |
10,167 |
|
11,220 |
|
8,510 |
|
|
|
|
|
|
Total operating expenses ................................... |
(8,014) |
|
(7,704) |
|
(7,741) |
|
|
|
|
|
|
Operating profit ........ |
2,153 |
|
3,516 |
|
769 |
|
|
|
|
|
|
Income from associates43 |
(6) |
|
5 |
|
12 |
|
|
|
|
|
|
Profit before tax ......... |
2,147 |
|
3,521 |
|
781 |
|
|
|
|
|
|
Cost efficiency ratio ..... |
70.7% |
|
60.6% |
|
77.2% |
|
|
|
|
|
|
RoRWA44 ..................... |
1.4% |
|
2.2% |
|
0.5% |
|
|
|
|
|
|
Period-end staff numbers |
76,879 |
|
73,431 |
|
75,698 |
Reduction in reported 22%
|
|||||
Market share of new 11%
|
|||||
Strong trade revenue growth
|
|||||
For footnotes, see page 81. The commentary on Europe is on an underlying basis unless stated otherwise. |
Economic background
The UK's economic recovery remained disappointingly lacklustre in the first half of 2011. In the first quarter, the level of real Gross Domestic Product ('GDP') rose by 0.5%, having fallen by 0.5% in the previous quarter. The unemployment rate edged down to 7.7% in the three months to April as modest job shedding in the public sector, in reaction to ongoing fiscal austerity, was offset by job gains in the private sector. The level of turnover in the housing market remained subdued. The Bank of England left interest rates unchanged at 0.5% and the Asset Purchase Facility remained steady at £200bn. CPI inflation was well above the Bank of England's 2% target throughout the period, reaching 4.5% in May, partly from the rise in VAT at the start of the year, and increases in commodity prices.
The eurozone recovery continued to be uneven, with countries in the north of the region demonstrating strong growth while economies in the south, particularly those focused on fiscal consolidation, saw more modest levels of activity. In part because of rising commodity prices, eurozone inflation rose above the European Central Bank's ('ECB's) target, reaching 2.7% in June, and the ECB began to tighten monetary policy, raising the refi rate in April and July, taking it to 1.5%. For certain countries, particularly Greece, concerns in sovereign bond markets intensified. As it became clear that Greece would be unable to return to the private capital markets in the first half of 2012, the eurozone heads of state arranged in July 2011 for further medium-term financial assistance to be provided to the country.
Review of performance
Our European operations reported a pre-tax profit of US$2.1bn, compared with US$3.5bn in the first half of 2010, a decrease of 39%. Included within these results were adverse fair value movements of US$71m in the first half of 2011 due to the change in credit spreads on the Group's own debt held at fair value, compared with favourable fair value movements of US$574m in the first half of 2010. The first half of 2010 included a gain of US$107m on the disposal of the HSBC Insurance Brokers business along with the operating results of Eversholt Rail Group which was sold in December 2010. Excluding these items, underlying pre-tax profits decreased by 28%, mainly due to lower revenues in GB&M.
In GB&M, we are investing in the business by expanding our capabilities across the region and further enhancing our product offering in areas such as Payments and Cash Management, Securities
|
Retail Management16 US$m |
|
Commercial Banking US$m |
Global Markets16 US$m |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Half-year to 30 June 2011 |
|
|
|
|
|
|
|
|
|
|
|
UK ............................................................. |
634 |
|
761 |
|
483 |
|
108 |
|
(862) |
|
1,124 |
France56 ..................................................... |
139 |
|
111 |
|
274 |
|
10 |
|
(89) |
|
445 |
Germany .................................................... |
23 |
|
38 |
|
121 |
|
21 |
|
6 |
|
209 |
Malta ......................................................... |
31 |
|
34 |
|
6 |
|
- |
|
- |
|
71 |
Switzerland ................................................. |
- |
|
(5) |
|
- |
|
122 |
|
- |
|
117 |
Turkey ....................................................... |
11 |
|
42 |
|
31 |
|
- |
|
- |
|
84 |
Other ......................................................... |
(69) |
|
63 |
|
87 |
|
54 |
|
(38) |
|
97 |
|
|
|
|
|
|
|
|
|
|
|
|
|
769 |
|
1,044 |
|
1,002 |
|
315 |
|
(983) |
|
2,147 |
|
|
|
|
|
|
|
|
|
|
|
|
Half-year to 30 June 2010 |
|
|
|
|
|
|
|
|
|
|
|
UK ............................................................. |
483 |
|
500 |
|
1,356 |
|
116 |
|
(366) |
|
2,089 |
France56 ..................................................... |
87 |
|
83 |
|
401 |
|
6 |
|
157 |
|
734 |
Germany .................................................... |
19 |
|
17 |
|
127 |
|
18 |
|
(4) |
|
177 |
Malta ......................................................... |
21 |
|
28 |
|
7 |
|
- |
|
- |
|
56 |
Switzerland ................................................. |
- |
|
- |
|
- |
|
161 |
|
- |
|
161 |
Turkey ....................................................... |
35 |
|
47 |
|
58 |
|
- |
|
- |
|
140 |
Other ......................................................... |
(46) |
|
34 |
|
99 |
|
58 |
|
19 |
|
164 |
|
|
|
|
|
|
|
|
|
|
|
|
|
599 |
|
709 |
|
2,048 |
|
359 |
|
(194) |
|
3,521 |
|
|
|
|
|
|
|
|
|
|
|
|
Half-year to 31 December 2010 |
|
|
|
|
|
|
|
|
|
|
|
UK ............................................................. |
698 |
|
327 |
|
416 |
|
107 |
|
(1,239) |
|
309 |
France56 ..................................................... |
51 |
|
52 |
|
(25) |
|
12 |
|
(131) |
|
(41) |
Germany .................................................... |
17 |
|
15 |
|
104 |
|
12 |
|
8 |
|
156 |
Malta ......................................................... |
16 |
|
28 |
|
10 |
|
- |
|
- |
|
54 |
Switzerland ................................................. |
- |
|
(5) |
|
- |
|
104 |
|
- |
|
99 |
Turkey ....................................................... |
29 |
|
33 |
|
47 |
|
1 |
|
- |
|
110 |
Other ......................................................... |
(98) |
|
46 |
|
103 |
|
45 |
|
(2) |
|
94 |
|
|
|
|
|
|
|
|
|
|
|
|
|
713 |
|
496 |
|
655 |
|
281 |
|
(1,364) |
|
781 |
For footnotes, see page 81.
Services, Prime Services and Equities. Lower revenues compared with the first half of 2010 were driven by reductions in Balance Sheet Management and legacy Credit.
In the UK CMB business, income from UK based customers using products to support international activity grew by 16% compared with the first half of 2010. We remain on track to achieve our lending goals under the Merlin Agreement with the UK government, having made available total new facilities of £22.7bn (US$36.3bn) in the first half of 2011, compared with a full year target of £38.8bn (US$62.1bn), with capacity to increase this to £44.1bn (US$70.6bn) if there is sufficient demand on commercial terms. For UK SMEs, we have provided gross new facilities of £5.6bn (US$9.0bn), compared with a goal of £11.7bn (US$18.7bn) for the full year, with committed capacity for additional facilities of at least £1.2bn (US$1.9bn) if required.
In the UK personal sector, we delivered further growth in mortgage balances and increased our market share of new lending to 11% while maintaining a conservative new lending loan-to-value ratio of 53%. The investment business continued to grow and we increased our assets under management of HSBC World Selection by 20% to US$3.9bn in the first half of the year.
Within Continental Europe, there was a continued focus on selected markets where we have scale and opportunities for growth, particularly in wealth management, CMB and GB&M.
In GPB, the focus remained on enhancing client experience through the delivery of bespoke services and global connections. Client assets increased due to net new money inflows, together with favourable market and foreign exchange movements.
Across the region there was a drive to improve efficiency and rationalise the portfolio and, to that end, we announced the closure of our retail businesses in Russia and Poland, as well as initiatives to improve operational efficiency in France and the UK. We continued to monitor our portfolio against strict targets, and keep our cost base under review.
Net interest income decreased by 9% as Balance Sheet Management revenues reduced. This was due to higher-yielding positions maturing and opportunities for reinvestment at similar yields being limited by the prevailing low interest rate environment and flatter yield curves. It was partly offset by growth in mortgage and commercial lending balances and wider lending spreads. We continued to build on our strong deposit base in the UK despite fierce competition for customer deposits.
Net fee income decreased by 4%. The increases in GPB from growth in assets under management and higher levels of client activity, along with an increase in domestic and international payments in the UK, did not offset lower fee income in GB&M for management services as the comparable period in 2010 benefited from higher fees generated from the securities investment conduits.
Net trading income increased by 7%. There were lower adverse fair value movements on non-qualifying hedges used to economically hedge fixed-rate long-term debt issued by HSBC Holdings. These were driven by a less pronounced decrease in long-term US interest rates relative to sterling and euro interest rates than those experienced in the first half of 2010. In addition, there were favourable foreign exchange movements on trading assets held as economic hedges of foreign currency debt designated at fair value. These offset adverse foreign exchange movements on the foreign currency debt which is reported in 'Net expense from financial instruments designated at fair value'.
Excluding the above items, net trading income decreased. This reflected lower favourable fair value movements on structured liabilities, mainly in Rates. Credit trading revenues were affected by the re-emergence of eurozone sovereign debt concerns in the second quarter of 2011 which resulted in a reduction in client activity and a general widening of credit spreads. In addition, foreign exchange revenues were constrained by continued spread compression due to increased competition. Benefiting from recent investment spending, higher revenues in Equities reflected an improved competitive positioning which helped capture increasing client flows, particularly during the rally in global equity markets in the first quarter of 2011.
Net expense from financial instruments designated at fair valueincreased by US$143m. There were adverse foreign exchange movements on foreign currency debt designated at fair value, issued as part of our overall funding strategy, with an offset reported in 'Net trading income'. These adverse movements were partly mitigated by gains on the fair value of assets held to meet liabilities under insurance and investment contracts that were recognised as equity markets rose, compared with losses experienced in the first half of 2010. To the extent that these gains accrued to policyholders holding unit-linked insurance policies and insurance or investment contracts with DPF, there was a corresponding increase in 'Net insurance claims incurred and movement in liabilities to policyholders'.
Gains less losses from financial investments increased by US$62m, driven by gains on certain securitised debt portfolios.
Net earned insurance premiums increased by 6% reflecting successful targeted sales campaigns in RBWM, notably for investment contracts with DPF in France, and higher sales of unit-linked products in the UK. This was partly offset by a reduction in premiums resulting from the non-renewal and transfer to third parties of certain contracts in our Irish business, and the run-off of the legacy motor book in the UK.
Other operating income decreased by 23%, largely reflecting the non-recurrence of a gain on the sale and leaseback of our Paris headquarters in the first half of 2010, partly offset by the benefit from a refinement of the calculation of the PVIF asset during the period (see footnote 27 on page 81).
Net insurance claims incurred and movement in liabilities to policyholders increased by 23%. Investment gains, which contrasted with investment losses in the first half of 2010, led to an increase in the movement in liabilities to policyholders. Additional reserves were also established for new business written, consistent with the increase in net earned insurance premiums. The non-renewal and transfer to third parties of certain contracts in the Irish business and the run-off of the legacy motor book in the UK resulted in a decrease in net insurance claims incurred and movement in liabilities to policyholders, partly offsetting the above.
Loan impairment charges and other credit risk provisionsdecreased by 26% to US$1.2bn, reflecting an improved credit environment in the region and successful risk mitigation by management in RBWM. The decline in loan impairment charges was also attributable to lower delinquency rates across both the secured and unsecured lending portfolios in the UK as a result of better collections capability and enhanced credit risk management practices. In CMB, loan impairment charges fell in the UK across a range of industry sectors. In GB&M, loan impairment charges and other credit risk provisions declined despite recording a charge of US$65m to write down to market value available-for-sale Greek sovereign debt now judged to be impaired. In addition, impairments of US$40m were included in our GPB and insurance businesses in relation to Greek available-for-sale debt securities.
Operating expenses in the first half of 2011 included US$611m of provisions relating to UK customer redress programmes, including a provision in respect of the adverse judgement in the Judicial Review relating to sales of PPI in the UK. This was offset by a credit of US$587m resulting from a change in the inflation measure used to calculate the defined benefit obligation in the UK for deferred
pensions. The first half of 2010 included one-off payroll and bonus taxes of US$398m (US$367m as reported) in the UK and France. Excluding these items, operating expenses increased by 6%. This included an acceleration in the expense recognition of deferred bonus awards. We also continued to invest in strategic initiatives in GB&M, including the development of Prime Services and equity market capabilities and the expansion of the Rates and Foreign Exchange e‑commerce platforms.
Profit/(loss) before tax and balance sheet data - Europe
|
Half-year to 30 June 2011 |
||||||||||||
|
Retail |
|
Commercial Banking |
|
Global Banking |
|
Global |
|
Other US$m |
|
Inter- elimination52 US$m |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income/ (expense) ............ ............................ |
2,861 |
|
1,522 |
|
1,107 |
|
476 |
|
(271) |
|
(129) |
|
5,566 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net fee income/ |
1,323 |
|
813 |
|
516 |
|
496 |
|
(17) |
|
- |
|
3,131 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading income/(expense) excluding net interest income ... |
36 |
|
6 |
|
1,268 |
|
84 |
|
(196) |
|
- |
|
1,198 |
Net interest income on trading activities ............. |
6 |
|
8 |
|
636 |
|
9 |
|
21 |
|
129 |
|
809 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net trading income/ (expense)45 ......... |
42 |
|
14 |
|
1,904 |
|
93 |
|
(175) |
|
129 |
|
2,007 |
Net income/(expense) from financial instruments designated at fair value ................... |
105 |
|
25 |
|
(211) |
|
- |
|
(159) |
|
- |
|
(240) |
Gains less losses from financial investments ........ |
56 |
|
1 |
|
254 |
|
(4) |
|
5 |
|
- |
|
312 |
Dividend income ..... |
1 |
|
1 |
|
19 |
|
3 |
|
1 |
|
- |
|
25 |
Net earned insurance premiums ............ |
2,201 |
|
191 |
|
- |
|
- |
|
(6) |
|
- |
|
2,386 |
Other operating income ................ |
142 |
|
40 |
|
96 |
|
8 |
|
264 |
|
102 |
|
652 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating income/(expense) .......................... |
6,731 |
|
2,607 |
|
3,685 |
|
1,072 |
|
(358) |
|
102 |
|
13,839 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net insurance claims53 ............... |
(2,316) |
|
(180) |
|
- |
|
- |
|
(3) |
|
- |
|
(2,499) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income/(expense)41 ....................... |
4,415 |
|
2,427 |
|
3,685 |
|
1,072 |
|
(361) |
|
102 |
|
11,340 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan impairment (charges)/ recoveries and other credit risk provisions ........... |
(394) |
|
(369) |
|
(382) |
|
(34) |
|
6 |
|
- |
|
(1,173) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income/(expense) .......................... |
4,021 |
|
2,058 |
|
3,303 |
|
1,038 |
|
(355) |
|
102 |
|
10,167 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses . |
(3,249) |
|
(1,013) |
|
(2,299) |
|
(723) |
|
(628) |
|
(102) |
|
(8,014) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit/(loss) ....... |
772 |
|
1,045 |
|
1,004 |
|
315 |
|
(983) |
|
- |
|
2,153 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profit/(loss) in associates and joint ventures ...... |
(3) |
|
(1) |
|
(2) |
|
- |
|
- |
|
- |
|
(6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax ...................... |
769 |
|
1,044 |
|
1,002 |
|
315 |
|
(983) |
|
- |
|
2,147 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% |
|
% |
|
% |
|
% |
|
% |
|
|
|
% |
Share of HSBC's profit before tax . |
6.7 |
|
9.1 |
|
8.7 |
|
2.8 |
|
(8.6) |
|
|
|
18.7 |
Cost efficiency ratio ............................ |
73.6 |
|
41.7 |
|
62.4 |
|
67.4 |
|
(173.5) |
|
|
|
70.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet data39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US$m |
|
US$m |
|
US$m |
|
US$m |
|
US$m |
|
|
|
US$m |
Loans and advances to |
154,055 |
|
100,140 |
|
200,498 |
|
30,354 |
|
1,284 |
|
|
|
486,331 |
Total assets ............. |
221,095 |
|
123,446 |
|
1,075,148 |
|
80,073 |
|
72,488 |
|
(192,942) |
|
1,379,308 |
Customer accounts .. |
178,819 |
|
101,195 |
|
207,891 |
|
60,906 |
|
- |
|
|
|
548,811 |
|
Half-year to 30 June 2010 |
||||||||||||
|
Retail Management16 US$m |
|
Commercial Banking |
|
Global Banking and Markets16 US$m |
|
Global |
|
Other US$m |
|
Inter- elimination52 US$m |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income/ (expense) ...... ...................... |
2,706 |
|
1,324 |
|
1,648 |
|
424 |
|
(292) |
|
(8) |
|
5,802 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net fee income/ |
1,221 |
|
796 |
|
719 |
|
444 |
|
(3) |
|
- |
|
3,177 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading income/(expense) excluding net interest income .......... |
(19) |
|
14 |
|
1,342 |
|
105 |
|
(570) |
|
- |
|
872 |
Net interest income on trading activities ....... |
- |
|
7 |
|
700 |
|
10 |
|
7 |
|
8 |
|
732 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net trading income/ (expense)45 .... |
(19) |
|
21 |
|
2,042 |
|
115 |
|
(563) |
|
8 |
|
1,604 |
Net income/(expense) from financial instruments designated at fair value ....... |
(121) |
|
(26) |
|
(31) |
|
- |
|
751 |
|
- |
|
573 |
Gains less losses from financial investments ... |
(1) |
|
- |
|
241 |
|
1 |
|
(4) |
|
- |
|
237 |
Dividend income ...................... |
- |
|
- |
|
12 |
|
2 |
|
- |
|
- |
|
14 |
Net earned insurance premiums ...... |
2,012 |
|
130 |
|
- |
|
- |
|
(5) |
|
- |
|
2,137 |
Other operating income........... |
104 |
|
125 |
|
303 |
|
4 |
|
479 |
|
126 |
|
1,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating income........... |
5,902 |
|
2,370 |
|
4,934 |
|
990 |
|
363 |
|
126 |
|
14,685 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net insurance claims53 ......... |
(1,882) |
|
(81) |
|
- |
|
- |
|
(1) |
|
- |
|
(1,964) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income41 ....... |
4,020 |
|
2,289 |
|
4,934 |
|
990 |
|
362 |
|
126 |
|
12,721 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan impairment charges |
(686) |
|
(410) |
|
(394) |
|
(11) |
|
- |
|
- |
|
(1,501) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income .......... |
3,334 |
|
1,879 |
|
4,540 |
|
979 |
|
362 |
|
126 |
|
11,220 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses ........ |
(2,738) |
|
(1,171) |
|
(2,493) |
|
(620) |
|
(556) |
|
(126) |
|
(7,704) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit/(loss) ... |
596 |
|
708 |
|
2,047 |
|
359 |
|
(194) |
|
- |
|
3,516 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profit in associates and joint ventures |
3 |
|
1 |
|
1 |
|
- |
|
- |
|
- |
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax ...... |
599 |
|
709 |
|
2,048 |
|
359 |
|
(194) |
|
- |
|
3,521 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% |
|
% |
|
% |
|
% |
|
% |
|
|
|
% |
Share of HSBC's profit before tax ................ |
5.4 |
|
6.3 |
|
18.5 |
|
3.2 |
|
(1.7) |
|
|
|
31.7 |
Cost efficiency ratio .............. |
68.1 |
|
51.2 |
|
50.5 |
|
62.6 |
|
153.6 |
|
|
|
60.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet data39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US$m |
|
US$m |
|
US$m |
|
US$m |
|
US$m |
|
|
|
US$m |
Loans and advances to |
135,746 |
|
82,822 |
|
163,020 |
|
24,717 |
|
921 |
|
|
|
407,226 |
Total assets ....... |
193,060 |
|
105,134 |
|
1,019,364 |
|
70,116 |
|
74,744 |
|
(181,720) |
|
1,280,698 |
Customer accounts ........ |
156,581 |
|
95,558 |
|
170,695 |
|
54,423 |
|
1 |
|
|
|
477,258 |
Profit/(loss) before tax and balance sheet data - Europe (continued)
|
Half-year to 31 December 2010 |
||||||||||||
|
Retail Management16 US$m |
|
Commercial Banking |
|
Global Banking and Markets16 US$m |
|
Global |
|
Other US$m |
|
Inter- elimination52 US$m |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income/ (expense) ...... ...................... |
2,831 |
|
1,450 |
|
1,287 |
|
447 |
|
(362) |
|
(205) |
|
5,448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net fee income . ...................... |
1,338 |
|
774 |
|
601 |
|
439 |
|
42 |
|
- |
|
3,194 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading income/(expense) excluding net interest income .......... |
13 |
|
(11) |
|
199 |
|
80 |
|
308 |
|
- |
|
589 |
Net interest income on trading activities ....... |
(1) |
|
12 |
|
427 |
|
11 |
|
16 |
|
205 |
|
670 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net trading income45 ....... |
12 |
|
1 |
|
626 |
|
91 |
|
324 |
|
205 |
|
1,259 |
Net income/(expense) from financial instruments designated at fair value........ |
617 |
|
139 |
|
8 |
|
- |
|
(1,055) |
|
- |
|
(291) |
Gains less losses from financial investments ... |
(35) |
|
- |
|
284 |
|
(8) |
|
8 |
|
- |
|
249 |
Dividend income ...................... |
- |
|
1 |
|
4 |
|
- |
|
1 |
|
- |
|
6 |
Net earned insurance premiums ...... |
1,788 |
|
148 |
|
- |
|
- |
|
(6) |
|
- |
|
1,930 |
Other operating income .......... |
83 |
|
38 |
|
514 |
|
3 |
|
275 |
|
63 |
|
976 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating income/ (expense) ...... |
6,634 |
|
2,551 |
|
3,324 |
|
972 |
|
(773) |
|
63 |
|
12,771 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net insurance claims53 ......... |
(2,482) |
|
(261) |
|
- |
|
- |
|
1 |
|
- |
|
(2,742) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income/ (expense)41 .... |
4,152 |
|
2,290 |
|
3,324 |
|
972 |
|
(772) |
|
63 |
|
10,029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan impairment (charges)/ recoveries and other credit risk provisions ...................... |
(531) |
|
(587) |
|
(389) |
|
(15) |
|
3 |
|
- |
|
(1,519) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income/ (expense) ...... |
3,621 |
|
1,703 |
|
2,935 |
|
957 |
|
(769) |
|
63 |
|
8,510 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses ........ |
(2,909) |
|
(1,207) |
|
(2,291) |
|
(676) |
|
(595) |
|
(63) |
|
(7,741) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit/(loss) ... |
712 |
|
496 |
|
644 |
|
281 |
|
(1,364) |
|
- |
|
769 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profit in associates and joint ventures |
1 |
|
- |
|
11 |
|
- |
|
- |
|
- |
|
12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before tax ...... |
713 |
|
496 |
|
655 |
|
281 |
|
(1,364) |
|
- |
|
781 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% |
|
% |
|
% |
|
% |
|
% |
|
|
|
% |
Share of HSBC's profit |
9.0 |
|
6.3 |
|
8.3 |
|
3.5 |
|
(17.3) |
|
|
|
9.8 |
Cost efficiency ratio .............. |
70.1 |
|
52.7 |
|
68.9 |
|
69.5 |
|
(77.1) |
|
|
|
77.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet data39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US$m |
|
US$m |
|
US$m |
|
US$m |
|
US$m |
|
|
|
US$m |
Loans and advances to |
145,069 |
|
91,744 |
|
170,369 |
|
27,629 |
|
988 |
|
|
|
435,799 |
Total assets ....... |
205,032 |
|
111,356 |
|
962,861 |
|
76,631 |
|
65,824 |
|
(172,177) |
|
1,249,527 |
Customer accounts ........ |
169,016 |
|
96,597 |
|
169,836 |
|
56,114 |
|
- |
|
|
|
491,563 |
For footnotes, see page 81.