Annual Financial Report - 30

RNS Number : 4139J

HSBC Holdings PLC

30 March 2010

 



Profit/(loss) for the year

	Year ended 31 December 2009
	Europe		Hong        Kong		Rest of        Asia-     Pacific1		Middle          East1		North America		Latin America		Intra-      HSBC       Items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m
Interest income ......................	20,283		5,327		5,877		2,260		19,526		10,091		(1,268)		62,096
Interest expense .....................	(8,015)		(1,132)		(2,338)		(775)		(5,856)		(4,518)		1,268		(21,366)
Net interest income ...............	12,268		4,195		3,539		1,485		13,670		5,573		-		40,730
Fee income ............................	8,576		3,099		1,972		682		5,496		2,230		(652)		21,403
Fee expense ...........................	(2,309)		(430)		(415)		(57)		(679)		(501)		652		(3,739)
Net fee income ......................	6,267		2,669		1,557		625		4,817		1,729		-		17,664
Trading income excluding  net interest income ...........	2,861		1,068		1,264		369		35		639		-		6,236
Net interest income on trading activities ............	2,598		157		342		25		296		209		-		3,627
Net trading income ................	5,459		1,225		1,606		394		331		848		-		9,863
Changes in fair value of long- term debt issued and related derivatives ..........................	(2,746)		(3)		(1)		-		(3,497)		-		-		(6,247)
Net income from other financial instruments designated at fair value .......	1,321		788		111		-		1		495		-		2,716
Net income from financial instruments designated at fair value ............................	(1,425)		785		110		-		(3,496)		495		-		(3,531)
Gains less losses from financial investments ........................	50		9		(19)		16		296		168		-		520
Dividend income ....................	29		28		2		3		53		11		-		126
Net earned insurance premiums ...........................................	4,223		3,674		365		-		309		1,900		-		10,471
Other operating income .........	2,262		1,274		1,238		71		566		133		(2,756)		2,788
Total operating income ......	29,133		13,859		8,398		2,594		16,546		10,857		(2,756)		78,631
Net insurance claims incurred and movement in liabilities to policyholders .................	(5,589)		(4,392)		(395)		-		(241)		(1,833)		-		(12,450)
Net operating income before loan impairment charges and other credit risk provisions .........................	23,544		9,467		8,003		2,594		16,305		9,024		(2,756)		66,181
Loan impairment charges and other credit risk provisions .	(5,568)		(500)		(896)		(1,334)		(15,664)		(2,526)		-		(26,488)
Net operating income .........	17,976		8,967		7,107		1,260		641		6,498		(2,756)		39,693
Employee compensation and benefits  .............................	(7,174)		(2,102)		(2,363)		(545)		(4,085)		(2,199)		-		(18,468)
General and administrative expenses .............................	(5,775)		(1,502)		(1,872)		(419)		(3,794)		(2,786)		2,756		(13,392)
Depreciation and impairment of property, plant and equipment	(762)		(224)		(172)		(31)		(329)		(207)		-		(1,725)
Amortisation and impairment of intangible assets .............	(277)		(118)		(43)		(6)		(183)		(183)		-		(810)
Total operating expenses ...	(13,988)		(3,946)		(4,450)		(1,001)		(8,391)		(5,375)		2,756		(34,395)
Operating profit/(loss) .......	3,988		5,021		2,657		259		(7,750)		1,123		-		5,298
Share of profit in associates and joint ventures ...............	21		8		1,543		196		12		1		-		1,781
Profit/(loss) before tax .......	4,009		5,029		4,200		455		(7,738)		1,124		-		7,079
Tax income/(expense) ...........	(776)		(869)		(753)		(94)		2,285		(178)		-		(385)
Profit/(loss) for the year ....	3,233		4,160		3,447		361		(5,453)		946		-		6,694

Profit/(loss) for the year (continued)

	Year ended 31 December 2008
	Europe		Hong        Kong		Rest of         Asia-      Pacific1		Middle          East1		North    America		Latin    America		Intra-        HSBC        items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m
Interest income ......................	35,117		9,530		9,066		2,451		25,897		11,632		(2,392)		91,301
Interest expense .....................	(25,421)		(3,832)		(5,129)		(895)		(10,679)		(5,174)		2,392		(48,738)
Net interest income ...............	9,696		5,698		3,937		1,556		15,218		6,458		-		42,563
Fee income ............................	10,225		3,062		2,414		740		6,292		2,716		(685)		24,764
Fee expense ...........................	(2,733)		(482)		(547)		(49)		(1,065)		(549)		685		(4,740)
Net fee income ......................	7,492		2,580		1,867		691		5,227		2,167		-		20,024
Trading income/(expense) excluding net interest income ...........................................	1,691		856		1,443		380		(3,879)		356		-		847
Net interest income on trading activities ............	3,666		337		599		22		744		345		-		5,713
Net trading income/(expense)	5,357		1,193		2,042		402		(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/(expense) 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)		24		8		(120)		176		-		197
Dividend income ....................	130		41		2		2		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		1,055		9		23		300		(2,492)		1,808
Total operating income .........	34,046		12,076		8,953		2,668		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		8,981		2,668		21,179		10,513		(2,492)		81,682
Loan impairment charges and other credit risk provisions .	(3,754)		(765)		(852)		(279)		(16,795)		(2,492)		-		(24,937)
Net operating income ............	26,925		9,389		8,129		2,389		4,384		8,021		(2,492)		56,745
Employee compensation and benefits ..............................	(8,551)		(2,069)		(2,475)		(544)		(4,609)		(2,544)		-		(20,792)
General and administrative expenses .............................	(6,428)		(1,562)		(2,037)		(384)		(4,282)		(3,059)		2,492		(15,260)
Depreciation and impairment of property, plant and equipment	(865)		(209)		(163)		(25)		(265)		(223)		-		(1,750)
Amortisation and impairment of intangible assets .............	(228)		(103)		(29)		(6)		(203)		(164)		-		(733)
Goodwill impairment ..............	-		-		-		-		(10,564)		-		-		(10,564)
Total operating expenses .......	(16,072)		(3,943)		(4,704)		(959)		(19,923)		(5,990)		2,492		(49,099)
Operating profit/(loss) ...........	10,853		5,446		3,425		1,430		(15,539)		2,031		-		7,646
Share of profit in associates and joint ventures ...............	16		15		1,297		316		11		6		-		1,661
Profit/(loss) before tax ...........	10,869		5,461		4,722		1,746		(15,528)		2,037		-		9,307
Tax income/(expense) ...........	(2,199)		(899)		(928)		(245)		1,715		(253)		-		(2,809)
Profit/(loss) for the year ........	8,670		4,562		3,794		1,501		(13,813)		1,784		-		6,498

	Year ended 31 December 2007
	Europe		Hong        Kong		Rest of         Asia-      Pacific1		Middle          East1		North    America		Latin    America		Intra-        HSBC        items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m
Interest income ......................	33,144		12,580		8,002		2,156		30,183		9,471		(3,177)		92,359
Interest expense .....................	(25,398)		(7,097)		(4,953)		(1,062)		(15,336)		(3,895)		3,177		(54,564)
Net interest income ...............	7,746		5,483		3,049		1,094		14,847		5,576		-		37,795
Fee income ............................	10,973		3,860		2,201		508		6,733		2,647		(585)		26,337
Fee expense ...........................	(2,542)		(498)		(426)		(37)		(923)		(494)		585		(4,335)
Net fee income ......................	8,431		3,362		1,775		471		5,810		2,153		-		22,002
Trading income/(expense) excluding net interest income ...........................................	3,003		1,270		946		256		(1,289)		272		-		4,458
Net interest income/(expense) on trading activities ............	3,940		(28)		400		41		747		276		-		5,376
Net trading income/(expense)	6,943		1,242		1,346		297		(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		36		2		245		253		-		1,956
Gains arising from dilution of interests in associates .........	-		-		1,081		-		-		11		-		1,092
Dividend income ....................	171		31		6		2		105		9		-		324
Net earned insurance premiums ...........................................	4,010		2,797		226		-		449		1,594		-		9,076
Other operating income .........	1,193		845		781		17		360		228		(1,985)		1,439
Total operating income .........	31,046		14,530		8,411		1,883		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		8,158		1,883		22,783		9,265		(1,985)		78,993
Loan impairment charges and other credit risk provisions .	(2,542)		(231)		(561)		(55)		(12,156)		(1,697)		-		(17,242)
Net operating income ............	25,025		11,091		7,597		1,828		10,627		7,568		(1,985)		61,751
Employee compensation and benefits ..............................	(9,022)		(2,124)		(2,084)		(447)		(5,384)		(2,273)		-		(21,334)
General and administrative expenses .............................	(6,429)		(1,386)		(1,741)		(300)		(4,653)		(2,770)		1,985		(15,294)
Depreciation and impairment of property, plant and equipment	(848)		(180)		(139)		(20)		(317)		(210)		-		(1,714)
Amortisation and impairment of intangible assets .............	(226)		(90)		(27)		(6)		(202)		(149)		-		(700)
Total operating expenses .......	(16,525)		(3,780)		(3,991)		(773)		(10,556)		(5,402)		1,985		(39,042)
Operating profit .....................	8,500		7,311		3,606		1,055		71		2,166		-		22,709
Share of profit in associates and joint ventures ...............	95		28		1,096		252		20		12		-		1,503
Profit before tax ....................	8,595		7,339		4,702		1,307		91		2,178		-		24,212
Tax income/(expense) ...........	(1,505)		(1,206)		(721)		(178)		332		(479)		-		(3,757)
Profit for the year .................	7,090		6,133		3,981		1,129		423		1,699		-		20,455

For footnote, see page 417.

Other information about the profit/(loss) for the year

	Europe		Hong        Kong		Rest of        Asia-     Pacific1		Middle          East1		North America		Latin America		Intra-      HSBC       items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m
Year ended 31 December 2009
Net operating income.............	17,976		8,967		7,107		1,260		641		6,498		(2,756)		39,693
External .............................	16,734		8,352		6,056		1,283		767		6,501		-		39,693
Inter-segment .....................	1,242		615		1,051		(23)		(126)		(3)		(2,756)		-
Profit/(loss) for the year includes the following significant non-cash items:
Depreciation, amortisation and impairment ..............	1,039		342		215		37		515		390		-		2,538
Loan impairment losses gross of recoveries and other credit risk provisions ......	5,833		534		1,028		1,361		15,757		2,865		-		27,378
Impairment of financial investments ....................	137		129		50		4		38		-		-		358
Year ended 31 December 2008
Net operating income.............	26,925		9,389		8,129		2,389		4,384		8,021		(2,492)		56,745
External .............................	25,887		8,205		7,010		2,386		5,236		8,021		-		56,745
Inter-segment .....................	1,038		1,184		1,119		3		(852)		-		(2,492)		-
Profit/(loss) for the year includes the following significant non-cash items:
Depreciation, amortisation and impairment ..............	1,093		312		192		31		11,352		387		-		13,367
Loan impairment losses gross of recoveries and other credit risk provisions ......	4,050		803		960		309		16,892		2,757		-		25,771
Impairment of financial investments ....................	278		535		-		-		229		-		-		1,042
Year ended 31 December 2007
Net operating income ............	25,025		11,091		7,599		1,826		10,627		7,568		(1,985)		61,751
External .............................	23,772		10,168		6,620		1,836		11,784		7,571		-		61,751
Inter-segment .....................	1,253		923		979		(10)		(1,157)		(3)		(1,985)		-
Profit for the year includes the following significant non-cash items:
Depreciation, amortisation and impairment ..............	1,074		270		166		26		627		359		-		2,522
Loan impairment losses gross of recoveries and other credit risk provisions ......	3,085		273		656		83		12,218		1,932		-		18,247
Impairment of financial investments ....................	42		-		-		-		-		-		-		42

For footnote, see page 417.

Performance ratios

	Europe		Hong        Kong		Rest of        Asia-     Pacific1		Middle          East1		North America		Latin America				Total
	US$m		US$m		US$m		US$m		US$m		US$m				US$m
Year ended 31 December 2009
Share of HSBC's profit before tax .....................................	56.7		71.0		59.3		6.4		(109.3)		15.9				100.0
Cost efficiency ratio ..............	59.4		41.7		55.6		38.6		51.5		59.6				52.0
Year ended 31 December 2008
Share of HSBC's profit before tax .....................................	116.7		58.7		50.7		18.8		(166.8)		21.9				100.0
Cost efficiency ratio ..............	52.4		38.8		52.4		35.9		94.1		57.0				60.1
Year ended 31 December 2007
Share of HSBC's profit before tax .....................................	35.5		30.3		19.4		5.4		0.4		9.0				100.0
Cost efficiency ratio ..............	59.9		33.4		48.9		41.1		46.3		58.3				49.4

1  For footnote, see below.

Balance sheet information

	Europe		Hong        Kong		Rest of        Asia-     Pacific1		Middle          East1		North America		Latin America		Intra-      HSBC       items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m		US$m
At 31 December 2009
Loans and advances to customers (net) ..................	439,481		99,381		80,043		22,844		206,853		47,629		-		896,231
Interests in associates and joint ventures .....................	147		157		11,083		1,573		42		9		-		13,011
Total assets ............................	1,268,600		399,243		222,139		48,107		475,014		115,967		(164,618)		2,364,452
Customer accounts .................	495,019		275,441		133,999		32,529		149,157		72,889		-		1,159,034
Total liabilities .......................	1,213,907		384,912		203,243		42,325		447,530		101,492		(164,618)		2,228,791
Capital expenditure incurred2 .	983		290		159		102		658		540		-		2,732
At 31 December 2008
Loans and advances to customers (net) ..................	426,191		100,220		80,661		27,295		256,214		42,287		-		932,868
Interests in associates and joint ventures .....................	137		153		9,728		1,383		128		8		-		11,537
Total assets ............................	1,392,049		414,484		225,573		50,952		596,302		102,946		(254,841)		2,527,465
Customer accounts .................	502,476		250,517		124,194		35,165		143,532		59,443		-		1,115,327
Total liabilities .......................	1,361,960		400,637		210,478		45,416		571,657		91,929		(254,841)		2,427,236
Capital expenditure incurred2 .	2,078		440		426		85		726		617		-		4,372
At 31 December 2007
Loans and advances to customers (net) ..................	452,275		89,638		80,245		21,607		289,860		47,923		-		981,548
Interests in associates and joint ventures .....................	158		155		8,602		1,265		127		77		-		10,384
Total assets ............................	1,256,220		359,386		208,195		45,669		574,318		102,649		(192,171)		2,354,266
Customer accounts .................	504,954		234,488		119,296		30,937		145,173		61,292		-		1,096,140
Total liabilities .......................	1,198,413		344,011		194,675		41,576		542,549		89,797		(192,171)		2,218,850
Capital expenditure incurred2 .	1,722		441		239		38		833		599		-		3,872

1  The Middle East is disclosed as a separate geographical region with effect from 1 January 2009. Previously, it formed part of Rest of Asia-Pacific. Comparative data have been restated accordingly.

2  Expenditure incurred on property, plant and equipment and other intangible assets. Excludes assets acquired as part of business combinations and goodwill.

Other financial information

Net operating income by customer group and global business

	Personal   Financial     Services	Commercial      Banking			Global    Banking & Markets		Private    Banking		Other1		Intra-       HSBC          items		Total
	US$m		US$m		US$m		US$m		US$m		US$m		US$m
Year ended 31 December 2009
Net operating income ............	15,513		9,571		18,652		2,984		(2,031)		(4,996)		39,693
External .............................	13,804		9,285		21,383		2,275		(7,054)		-		39,693
Inter-segment .....................	1,709		286		(2,731)		709		5,023		(4,996)		-
Year ended 31 December 2008
Net operating income ............	20,269		13,144		12,047		3,563		12,290		(4,568)		56,745
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)		-
Year ended 31 December 2007
Net operating income ............	27,067		12,943		15,172		3,534		6,947		(3,912)		61,751
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)		-

1  The main items reported in the 'Other' segment are certain property activities, unallocated investment activities, centrally held investment companies and HSBC's holding company and financing operations. The 'Other' segment also includes gains and losses on the disposal of certain significant subsidiaries or business units.

Information by country

	2009				2008				2007
	External net   operating  income1		Non-      current         assets2		External net     operating        income1		Non-        current           assets2		External net     operating        income1		Non-        current           assets2
	US$m		US$m		US$m		US$m		US$m		US$m
UK ..............................................................	9,958		19,704		15,789		12,491		15,955		12,394
Hong Kong ..................................................	8,352		3,374		8,205		3,527		10,168		3,226
USA ............................................................	(1,042)		5,499		2,862		4,660		9,304		20,403
France .........................................................	3,322		11,782		6,457		11,862		4,597		12,868
Brazil ..........................................................	3,368		1,868		3,886		1,421		3,659		1,735
Other countries ...........................................	15,735		25,557		19,546		23,020		18,068		22,420
	39,693		67,784		56,745		56,981		61,751		73,046

1  External net operating income is attributed to countries on the basis of the location of the branch responsible for reporting the results or advancing the funds.

2  Non-current assets consist of property, plant and equipment, goodwill, other intangible assets, interests in associates and joint ventures and certain other assets expected to be recovered more than twelve months after the reporting period.

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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