Interim Results - Part 4

HSBC HOLDINGS PLC
2 August 1999


PART FOUR


HSBC Holdings plc                           HSBC Investment Banking
                                                        (continued)
____________________________________________________________________

Figures in US$m                     30JUN99     30JUN98*   31DEC98 
                                                                   
Net interest income                     183         168        205 
Fees and commissions (net)              728         675        661 
Trading income**                        182          81         16 
Other income***                         114         142         99 
                                                                   
Total income                          1,207       1,066        981 
                                                                   
Operating expenses                     (904)       (780)      (756)
Bad and doubtful debts                  (19)          1        (39)
Other                                    32          10         (5)
Profit before tax                       316         297        181 
                                                                   
Attributable profit                     211         172        127 
                                                                   
Total assets                         40,177      35,576     36,649 
Shareholders' funds                   2,141       2,008      2,128 
Return on average shareholders'                                    
  funds                                19.6%       17.7%      12.2%
                                                                   
Staff numbers (FTE basis)             8,290       8,210      8,213 
                                                                   
Segmental analysis of pre-tax                                      
  profit:
                                                                   
- Asset management                       39          29         26 
- Private banking                       107         110        110 
- Other investment banking              170         158         45 
                                        316         297        181 
                                                                   

*    Restated to include HSBC Trinkaus & Burkhardt KGaA
     transferred to HSBC Investment Banking on 1 January 1999.

**   In order to present the results of HSBC Investment Banking on
     a basis consistent with common practice in investment
     banking, trading income as reported above includes all
     profits and losses relating to dealing activities, including
     interest income/expense and dividends arising from long and
     short positions. In this respect, it differs from dealing
     profits as reported on page 13.

***  Includes profit on disposal of venture capital investments,
     US$47 million in the first half of 1999 (first half 1998:
     US$71 million; second half 1998: US$24 million) which were
     included in gains on disposal of fixed assets and investments
     at HSBC Group level.

HSBC Holdings plc                            Additional Information
                                                                   
____________________________________________________________________

1.    Accounting policies                                        
     
The accounting policies adopted are consistent with those described
in the 1998 Annual Report and Accounts.

2.    Dividend                                                   
     
The Directors have declared a first interim dividend for 1999 of
US$0.133 per ordinary share, an increase of 8 per cent.  The
dividend will be payable on 7 October 1999 to shareholders on the
Register at the close of business on 20 August 1999. The dividend
will be payable in cash, in US dollars, sterling or Hong Kong
dollars, or a combination of these currencies, at the exchange
rates on 27 September 1999, with a scrip dividend alternative.
Particulars of these arrangements will be mailed to shareholders
on or about 27 August 1999, and elections will be required to be
made by 20 September 1999.

The dividend payable to holders of ADSs, each of which represents
five ordinary shares, will be paid in cash in US dollars on 7
October 1999 or invested in additional ADSs for participants in
the dividend reinvestment plan operated by HSBC Bank USA as
depositary.

The Company's shares will be quoted ex-dividend in London and in
Hong Kong on 16 August 1999. The ADSs will be quoted ex-dividend
in New York on 18 August 1999.

3.  Earnings and dividend per share
                                                             
                             Half-year    Half-year     Half-year 
Figures in US$              to 30JUN99   to 30JUN98    to 31DEC98 
                                                                  
Basic and diluted earnings                                        
  per share                       0.33         0.30          0.24 
                                                                  
Headline earnings per share       0.33         0.29          0.24 
                                                                  
Dividend per share               0.133        0.123         0.185 
                                                                  

Under the terms of the share capital reorganisation approved by the
High Court on 30 June 1999, each shareholder of HSBC Holdings plc
received three new ordinary shares of US$0.50 for each existing
ordinary share of HK$10 or ordinary share of 75p held on 2 July 1999.
Figures for earnings per share, dividend per share and net asset value
per share reflect the 3-for-1 share capital reorganisation that took
place on 2 July 1999.

Basic earnings per share was calculated by dividing the earnings of
US$2,694 million by the weighted average number of ordinary shares
outstanding of 8,167 million (first half of 1998: earnings of US$2,402
million and 8,045 million shares; second half of 1998: earnings of
US$1,916 million and 8,077 million shares).

Diluted earnings per share was calculated by dividing the basic
earnings, which require no adjustment for the effects of dilutive
ordinary potential shares, by the weighted average number of shares
outstanding plus the weighted average number of ordinary shares that
would be issued on conversion of all the dilutive potential ordinary
shares of  8,237 million (first half of 1998: 8,114 million shares;
second half of 1998: 8,140 million shares).

The headline earnings per share, calculated in accordance with the
definition in the Institute of Investment Management and Research
(IIMR) Statement of Investment Practice No. 1, 'The Definition of IIMR
Headline Earnings', increased by 12 per cent. The headline earnings
per share excluded the gains on the sale of fixed assets (other than
investment securities) and included the add back of amortised
goodwill.

4.  Provisions against advances                                       
                                                                       
Half-year to 30 June 1999                                             
                                                             Suspended 
Figures in US$m         Specific      General        Total    interest 
                                                                       
At 1 January 1999          4,639        2,019        6,658         768 
                                                                       
Amounts written off         (504)           -         (504)        (78)
                                                                       
Recoveries of advances                                                 
  written off in previous
  years                       81            -           81           - 
                                                                       
Charge/(credit) to profit                                              
  and loss account         1,102          (20)       1,082           - 
                                                                       
Interest suspended during                                              
  the period                   -            -            -         365 
                                                                       
Suspended interest                                                     
  recovered                    -            -            -        (114)
                                                                       
Exchange and other                                                     
  adjustments                (92)         (13)        (105)         (8)
                                                                       
                           5,226        1,986        7,212         933        
                                                 
At 30 June 1999

Total outstanding provisions
                                         At           At            At
Figures in US$m                     30JUN99      30JUN98       31DEC98 
                                                                       
Loans and advances to customers:                                       
                                                                       
- specific provisions                 5,200        3,774         4,608 
                                                                       
- general provisions                  1,986        2,077         2,019 
                                      7,186        5,851         6,627 
Loans and advances to banks:                                           
                                                                       
- specific provisions                    26           45            31 
                                                                       
Total provisions                      7,212        5,896         6,658 
                                                                      
Interest in suspense                    933          715           768 
                                                                       
Provisions against loans and advances to customers
                                         At           At           At
                                    30JUN99       30JUN98      31DEC98 
Total provisions to gross lending*                                     
                                          %             %            % 
Specific provisions                    2.18          1.57         1.93 
                                                                       
General provisions                                                     
- held against Asian risk              0.12          0.12         0.12 
- other                                0.71          0.75         0.72 
Total provisions                       3.01          2.44         2.77 
                                                                       
Non-performing loans and advances                                      
                                                                       
Figures in US$m                                                        
                                                                       
Banks                                    41            58           42 
                                                                       
Customers                             9,821         6,504        8,871 
Total non-performing loans and                                         
  advances                            9,862         6,562        8,913 
                                                                       
Total provisions cover as a                                            
  percentage of non-performing 
  loans and advances                   73.1%         89.9%        74.7%
                                                                       
* Net of suspended interest and reverse repo transactions

5.  Gains on disposal of investments
                                  Half-year     Half-year   Half-year 
                                 to 30JUN99    to 30JUN98  to 31DEC98
Figures in US$m                                                       
                                                                      
Gains on disposal of:                                                 
- investment securities                 142           138          72 
- part of a business                     10             -           - 
- associates                              3             -           3 
- subsidiaries                            -             9           - 
                                        155           147          75 

HSBC Private Equity recorded a US$47 million profit from venture
capital investment disposals (first half 1998: US$71 million; second
half 1998: US$24 million). Hang Seng Bank recorded profits on the
sale of listed equity investments of US$12 million (first half 1998:
US$8 million; second half 1998: nil).
                                                               
6.  Taxation                                                   
                                                               
                                 Half-year      Half-year   Half-year 
                                to 30JUN99     to 30JUN98  to 31DEC98
Figures in US$m                 
                                                                   
UK corporation tax                     431            488         244 
                                                                   
Overseas taxation                      634            576         542 
                                                                   
Deferred taxation                       34            (40)        (31)
                                                                     
Associated undertakings                  4              8           2 
                                                                    
Total charge for taxation            1,103          1,032         757 
                                                                   
Effective tax rate                    27.1%          28.0%       26.2%
                                                                   
The Company and its subsidiary undertakings in the UK provided for
UK corporation tax at 30.25 per cent, the rate for the calendar
year 1999 (1998: 31.0 per cent). Overseas tax included Hong Kong
profits tax of  US$175 million (first half 1998: US$170 million;
second half 1998: US$123 million) provided at the rate of 16.0 per
cent (1998: 16.0 per cent) on the profits assessable in Hong Kong.
Other overseas taxation was provided for in the countries of
operation at the appropriate rates of taxation.

At 30 June 1999, there were potential future tax benefits of
approximately US$425 million (31 December 1998: US$380 million) in
respect of trading losses, allowable expenditure charged to the
profit and loss account but not yet allowed for tax, and capital
losses which have not been recognised because recoverability of
the potential benefits is not considered certain.

The effective tax rate was below the standard rate of UK
corporation tax of 30.25 per cent, mainly because of lower rates
of tax in major subsidiaries overseas. The effective tax rate was
adversely affected by unrelieved losses in Malaysia in both the
second half of 1998 and the first half of 1999, and likewise, but
to a greater extent in the first half of 1998, as a result of
unrelieved losses in other Asian countries. The effective tax rate
in the second half of 1998 benefited from an exceptional prior
year tax credit in the US amounting to US$10 million in respect of
Brazilian tax credits.
                                                               
7.  Liabilities                                                
                      At 30JUN99       At 30JUN98        At 31DEC98

Figures in US$m                                                     
                               %                %                 % 
Customer         
  accounts       315,639    64.6  303,009    63.5   308,910    65.0 
                                                                    
Deposits by       
  banks           35,920     7.3   41,288     8.7    34,342     7.2 
                                                                    
Debt securities                                                     
  in issue        29,084     5.9   30,268     6.3    29,190     6.1 
                                                                    
Shareholders'                                                       
  funds           31,642     6.5   27,540     5.8    27,402     5.8 
                                                                    
Mark-to-market of                                                      
  exchange rate                                                          
  and interest
  rate contracts  13,454     2.7   18,168     3.8    19,615     4.1 
                                                                    
Other            
liabilities       63,504    13.0   56,570    11.9    56,261    11.8

                 489,243   100.0  476,843   100.0   475,720   100.0

HK SAR currency                                                     
  notes in                                                          
  circulation      7,277            7,524             7,408         
                                                                    
Total            
  liabilities    496,520          484,367           483,128               
                                                                    
Customer accounts
  include:                                                          
- repos            4,719            8,728             5,441         
- settlement                                                        
  accounts        10,834            7,369             5,125         
                                                                    
Deposits by                                                         
  banks include:                                                          
- repos            4,246            7,380             7,614         
- settlement                                                        
  accounts         4,998            4,412             2,981         
                                                                    

The Group continues to be funded primarily out of its customer
deposit base and its liability mix remains stable.

8.  Financial instruments, contingent liabilities and               
    commitments

                                         At          At         At  
Figures in US$m                     30JUN99     30JUN98    31DEC98  
                                                                    
Contract amounts                                                    
                                                                    
Contingent liabilities                                              
- acceptances and endorsements        3,663       4,077      4,032  
- guarantees and assets pledged                                     
  on collateral security             23,574      24,543     23,686  
- other                                   7         113         64  
                                     27,244      28,733     27,782  
                                                                    
Commitments                                                         
- documentary credits and short-                                    
  term trade-related transactions     6,072       6,560      5,927  
- forward asset purchases and                                  
  forward deposits placed               481       1,839        893  
- undrawn note issuing and                                          
  revolving underwriting                                            
  facilities                            360         147        405  
- undrawn formal standby                                            
  facilities, credit lines and
  other commitments to lend:
  - over 1 year                      27,586      29,810     27,028  
  - 1 year and under                106,364     106,680    112,399  
                                                      
                                    140,863     145,036    146,652  
                                                                    
Exchange rate contracts             636,820     810,124    765,665  
                                                                    
Interest rate contracts             913,272     940,923  1,060,563  
                                                                    
Equities contracts                   30,147      26,891     29,799  

The table above gives the nominal principal amounts of off-balance-
sheet transactions.

For contingent liabilities and commitments, the contract amount
represents the amount at risk should the contract be fully drawn
upon and the client default. The total of the contract amounts is
not representative of future liquidity requirements.

For exchange rate, interest rate and equities contracts, the
notional or contractual amounts of these instruments indicate the
nominal value of transactions outstanding at the balance sheet
date; they do not represent amounts at risk.

The decrease in exchange rate contracts since December 1998 and
June 1998 was largely as a result of falls in market volumes
subsequent to the introduction of the euro at the beginning of
1999.

9.  Off-balance-sheet risk-weighted and replacement cost amounts

                            At 30JUN99     At 30JUN98  At 31DEC98 
Figures in US$m                                                   
                                                                  
Risk-weighted amounts                                             
                                                                  
Contingent liabilities          19,814         19,241      19,823 
Commitments                     14,440         15,990      14,187 
                                                                  
Replacement cost amounts                                          
                                                                  
Exchange rate contracts          5,893         10,522       8,899 
Interest rate contracts          4,743          5,002       7,297 
Equities contracts               2,177          2,221       2,218 

Risk-weighted amounts are assessed in accordance with the Financial
Services Authority's guidelines which implement the Basle agreement
on capital adequacy and depend on the status of the counterparty
and the maturity characteristics.

Replacement cost of contracts represents the mark-to-market assets
on all contracts with a positive value, ie, an asset to the HSBC
Group. Replacement cost is, therefore, a close approximation of the
credit risk for these contracts as at the balance sheet date. The
actual credit risk is measured internally and is the sum of
positive mark-to-market value and an estimate for the future
fluctuation risk, using a future risk factor.

The decrease in the replacement cost amounts reflects both the
effect of market movements on outstanding contracts and a reduction
in business volumes.

10.  Market risk

Market risk is the risk that interest rates, foreign exchange rates
or equity and commodity prices will move and result in profits or
losses to the HSBC Group. Market risk arises on financial
instruments which are valued at current market prices (mark-to-
market basis) and those valued at cost plus any accrued interest
(accruals basis).

The Group makes markets in interest rate, exchange rate and equity
derivative instruments, as well as in debt, equities and other
securities. Trading risks arise either from customer-related
business or from position taking.

The Group manages market risk through risk limits approved by the
Group Executive Committee. Group Market Risk, an independent unit
within HSBC Holdings plc, develops risk management policies and
measurement techniques, and reviews limit utilisation on a daily
basis.

Risk limits are determined for each location and within location,
for each portfolio. Limits are set by product and risk type with
market liquidity being a principal factor in determining the level
of limits set. Only those offices with sufficient derivative
product expertise and appropriate control systems are authorised to
trade derivative products. Limits are set using a combination of
risk measurement techniques, including position limits, sensitivity
limits, as well as value at risk (VAR) limits at a portfolio level.
Similarly, option risks are controlled through full revaluation
limits in conjunction with limits on the underlying variables that
determine each option's value.

VAR is a technique which estimates the potential losses that could
occur on risk positions taken due to movements in market rates and
prices over a specified time horizon and to a given level of
confidence. The Group VAR, calculated on a variance/co-variance
basis, uses historical movements in market rates and prices, a 99
per cent confidence level, a 10 day holding period and generally
takes account of correlations between different markets and rates.
The movement in market prices is calculated by reference to market
data from the last two years. Aggregation of VAR from different
risk types is based upon the assumption of independence between
risk types.

The Group VAR is a principal component of the management of market
risk for the Group.  Historically this has been calculated to a 95
per cent confidence level and for a one day holding period. From
the beginning of 1999, VAR is being calculated at a 99 per cent
confidence level for a 10 day holding period*. This change has been
made to facilitate consistency with the regulatory requirements for
the use of internal models used to calculate market risk capital
requirements and remains consistent with the Group's risk
management control framework.

VAR methodologies have inherent limitations. Therefore, the Group
VAR should not be viewed as a maximum amount that the Group can
lose on its market risk positions. The Group recognises these
limitations by augmenting the VAR limits with other position and
sensitivity limit structures, as well as with stress testing, both
on individual portfolios and on a consolidated basis. The Group's
stress testing regime provides senior management with an assessment
of the impact of extreme events on the market risk exposures of the
Group.

VAR for all interest rate risk and foreign exchange risk positions
at 30 June 1999 was US$257.3 million compared with US$125.3 million
at 31 December 1998*. The average for the first half of 1999 was
US$216.8 million with a maximum of US$277.2* million and minimum of
US$167.9 million in the period.  VAR has been impacted
significantly by increased market volatility in the first half of
1999 particularly in sterling and Brazilian Real interest rates.

VAR related to foreign exchange dealing positions as at 30
June 1999 was US$29.1 million (US$14.2 million at 31 December
1998)*. The average VAR for the first half of 1999 was US$29.1
million, with a maximum of US$58.5 million and a minimum of US$16.6
million in the period. The VAR noted for foreign exchange positions
excludes structural foreign currency exposures, since related gains
or losses are taken through reserves.

VAR at 30 June 1999 related to interest rate exposures including
interest rate risk related to accrual book positions, was US$255.2
million (US$123.4 million at 31 December 1998)*. The average VAR for
the first half of 1999 was US$213.4 million, the maximum was
US$275.4 million and the minimum was US$163.0 million.

* The comparative figures for 1998 have been recalculated using
  a 99 per cent confidence level for a 10 day holding period using
  the VAR models in place at that date. It is not practicable
  retrospectively to amend these comparatives for other technical
  changes made to the VAR models since 31 December 1998.

The average daily revenue earned from market risk-related treasury
activities in the first half of 1999, including accrual book net
interest income and funding related to dealing positions, was
US$9.5 million (first half 1998: US$7.9 million; second half 1998:
US$7.7 million). The standard deviation of these daily revenues was
US$4.6 million. An analysis of the frequency distribution of daily
revenues shows that the lowest daily revenue was between
US$1 million and US$2 million, with three occurrences and there
were no days showing losses. The most frequent result was a daily
revenue of between US$7 million and US$8 million, with 17
occurrences. The highest daily revenue was US$26 million.

VAR at 30 June 1999 related to equities trading positions was
US$20.2 million (31 December 1998: US$12.0 million*). The average 
VAR for the first half of 1999 was US$15.4 million, the maximum 
was US$26.4 million and the minimum US$11.1 million.

11.  Segmental analysis

The allocation of earnings reflects the benefit of shareholders'
funds to the extent that these are actually allocated to businesses
in the segment by way of intra-Group capital and funding
structures. Common costs are included in segments on the basis of
the actual re-charges made.

Geographical information has been classified by the location of the
principal operations of the subsidiary undertaking, or in the case
of The Hongkong and Shanghai Banking Corporation, Midland Bank and
HSBC Bank Middle East operations, by the location of the branch
responsible for reporting the results or for advancing the funds.
Due to the nature of the Group structure, the analysis of profits
includes intra-Group items between geographic regions. The 'Rest of
Asia-Pacific' geographical segment includes the Middle East, India
and Australasia.

12.  Year 2000 readiness

HSBC recognises that with the approach of the new millennium the
inability of information technology (IT) and other systems around
the world to recognise the date change from 31 December 1999 to 
1 January 2000 could pose significant issues. HSBC has adopted the
Year 2000 conformity requirements issued by the British Standards
Institution as its definition of Year 2000 compliance, that is
neither performance nor functionality be affected by the changing
of dates during and after the Year 2000.

HSBC has assessed the impact of Year 2000 and does not expect
either its operations or service to customers to be disrupted as a
result of HSBC's systems not being Year 2000 compliant. HSBC does
not believe that the Year 2000 risks it faces in emerging markets
are markedly greater than those it faces in other markets. Steering
Committees have been formed in all the key business units and
progress on the Year 2000 compliance programme (the Year 2000
Programme) is reported regularly to their Boards of Directors and
to the Group Audit and Executive Committees.

HSBC is testing all of its relevant systems under the Year 2000
Programme to ensure that they are Year 2000 compliant and is
seeking written confirmation from suppliers and service providers
that their products and services are Year 2000 compliant. While
HSBC has received responses from a majority of its suppliers and
service providers and no material problems appear to be present, it
is still evaluating the responses.

HSBC is also assessing its customers' commitment to achieving
compliance and is providing information and assistance to help
customers understand the risks and issues. HSBC has revised
relevant credit and investment policies and trained relationship
managers to ensure that Year 2000 risks are taken account of in
credit and investment evaluations.

HSBC has already reviewed substantially all lines of programme code
in its computer systems for Year 2000 compliance and made the
required amendments or replacements. The great majority of these
systems have been tested and are currently in use. In addition,
HSBC expects to replace the small number of computer systems which
remain non-compliant by September 1999 as part of its existing
technology development programme.

In other areas of IT, HSBC is reviewing its end-user computing
applications, networks, centralised data systems and desktop
environments for Year 2000 compliance. Substantially all of HSBC's
end-user computing applications and inventory items related to
HSBC's networks have already been made compliant. HSBC's programme
to ensure the hardware and software elements of HSBC's data centre
systems have been made Year 2000 compliant is on schedule and
substantially complete.

HSBC has evaluated the potential effect of the Year 2000 on its non-
IT systems, including its facilities and other business processes.
Substantially all of HSBC's facilities and related systems have
been evaluated and, where not already compliant, are in the process
of being made compliant. Other business processes are similarly
being addressed across HSBC.

HSBC is finalising business contingency plans to address the
perceived risks associated with the arrival of Year 2000. These
plans include mitigating the effects of any failure to complete
remedial work on critical business systems, business resumption
contingency plans to address the possibility of systems failure and
market resumption contingency plans to address the possibility of
the failure of systems or processes outside HSBC's control. HSBC
is, however, unable to predict the effect if any of the efforts to
address the Year 2000 problem fail.

Lack of readiness on the part of third parties could expose HSBC to
the potential for loss, impairment of business processes and
activities and disruption of financial markets. HSBC is addressing
these risks through bilateral and multiparty efforts and
participates in industry, country and global initiatives.

For more than a decade, parts of HSBC have been modifying their
systems to be Year 2000 compliant when making other enhancements.
The costs of the Year 2000 modifications made as part of such a
combined package have not been separately identified. Costs
incurred for the six months ended 30 June 1999 were US$30 million
(including US$12 million attributable to incremental external
costs). HSBC expects that the additional costs of completing the
Year 2000 compliance and testing process will be approximately
US$24 million (including US$8 million attributable to incremental
external costs). Costs relating to major systems changes that are
not directly related to the Year 2000 but which address some Year
2000 issues are not included in these costs.

13. Attributable profit by subsidiary and line of business
                                                                  
                                 Half-year    Half-year      Half-year
Figures in US$m                    30JUN99      30JUN98        31DEC98
Hang Seng Bank                         550          491            385 
  less: minority interests            (208)        (186)          (146)
                                       342          305            239 
                                                                        
HSBC Investment Bank Asia Holdings      49           23             36 
                                                                        
The Hongkong and Shanghai Banking                                       
  Corporation and other                                                 
  subsidiaries                         707          459            330 
                                                                        
The Hongkong and Shanghai Banking                                      
  Corporation and subsidiaries       1,098          787            605 
                                                                        
Midland Bank                         1,004          909            817 
  less: preference dividend            (37)         (35)           (36)
                                       967          874            781 
HSBC USA Inc.                          235          249            278 
HSBC Bank Middle East                   60           61             80 
HSBC Bank Malaysia Berhad             (140)           5            (96)
HSBC Bank Canada*                       52           55             67 
HSBC Latin American operations         169           98             49 
HSBC Holdings sub-group                                                
-  Canary Wharf vacant space                                           
   provisions                            -            -           (158)
-  other                                27           33             (5)
Other commercial banking entities       67           79            108 
UK GAAP adjustments                     22           42            119 
Less: investment banking profits                                        
  included above**                     (74)         (53)           (39)
                                                                        
Commercial banking                   2,483        2,230          1,789 
                                                                        
Investment banking**                   211          172            127 
                                                                        
Group profit                         2,694        2,402          1,916 
                                                                        
*   Figures for HSBC Bank Canada for the second half of 1998 are based
    on the eight month period to 31 December 1998.  The attributable
    profit arising in the additional two month period was US$16 million.

**  Restated to include HSBC Trinkaus & Burkhardt KGaA transferred to
    HSBC Investment Banking on 1 January 1999.

14. Differences between UK GAAP and US GAAP

The consolidated financial statements of HSBC are prepared in
accordance with UK GAAP which differs in certain significant
respects from US GAAP. A summary of the significant differences
applicable to HSBC can be found in HSBC's Registration Statement on
Form 20-F for the year ended 31 December 1998.

The following tables summarise the significant adjustments to
consolidated net income and shareholders' equity which would result
from the application of US GAAP:

Figures in US$m                      Half-year to     Half-year to
                                          30JUN99          30JUN98  
Net Income
                                       
Attributable profit of HSBC                                                   
  (UK GAAP)                                 2,694            2,402 
Lease financing                               (32)             (41)
Debt swaps                                      -                5 
Shareholders' interest in long-
  term assurance fund                         (55)             (31)
Pension costs                                (112)             (19)
Stock-based compensation                      (36)             (16)
Goodwill                                     (151)            (161)
Internal software costs                        72                - 
Revaluation of property                        22               46 
Deferred taxation                                                  
-  US GAAP                                     (8)              12
-  on reconciling items                        35               28
                                               27               40 
Minority interest in reconciling                                   
  items                                         -              (12)
Estimated net income (US GAAP)              2,429            2,213 
                                        
                                                                   
Per share amounts                             US$              US$ 
Amounts on a US GAAP basis                                         
                                                                   
                                                                   
Basic earnings per ordinary share            0.30             0.28 
Diluted earnings per ordinary share          0.29             0.27
                                                                   
                                                                   

Figures in US$m                    

                                   At 30JUN99            At 31DEC98   
Shareholders' equity                      
Shareholders' funds (UK GAAP)          31,642                27,402 
Lease financing                          (206)                 (184)
Debt swaps                                (67)                  (66)
Shareholders' interest in long                                      
  -term assurance fund                   (503)                 (473)
Pension costs                            (980)                 (945)
Goodwill                                3,260                 3,640 
Internal software costs                    72                     - 
Revaluation of property                (2,471)               (2,507)
Fair value adjustment for                                           
  securities available for sale           507                   742 
Dividend payable                        1,118                 1,499 
Deferred taxation                                                   
-  US GAAP                                653                   661 
-  on reconciling items                   407                   318     
                                        1,060                   979 
Minority interest in                                                
  reconciling items                       240                   264 
Estimated shareholders' equity                                      
  (US GAAP)                            33,672                30,351 
                                   
Total assets

Total assets at 30 June 1999, incorporating adjustments arising
from the application of US GAAP, would be US$507,058 million 
(31 December 1998: US$493,099 million).

15.   Registers of shareholders
The Overseas Branch Register of shareholders in Hong Kong will be
closed from Wednesday, 18 August 1999 until Friday, 20 August 1999
(both dates inclusive). Any person who has acquired shares
registered on the Hong Kong Branch Register but who has not lodged
the share transfer with the Branch Registrar should do so before
4.00 pm on Tuesday, 17 August 1999 in order to receive the
dividend.

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 4.00 pm
on Friday, 20 August 1999 in order to receive the dividend.
Transfers between the Principal Register and the Branch Register
may not be made while the Branch Register is closed.

Similarly, transfers of American Depositary Shares must be lodged
with the depositary, HSBC Bank USA, by noon on Friday, 20 August
1999 in order to receive the dividend.

16.  Foreign currency amounts                                      
                                                                   
The sterling and Hong Kong dollar equivalent figures in the
consolidated profit and loss account and balance sheet are for
information only.

These are translated at the average rate for the period for the
profit and loss account and the closing rate for the balance sheet
as follows:
                                                              
Period-end                         30JUN99   30JUN98      31DEC98 
                                                                 
Closing  : HK$/US$                   7.759     7.749        7.746 
                                                                 
         : £/US$                     0.635     0.600        0.603 
                                                                 
Average  : HK$/US$                   7.751     7.745        7.747*
                                                                 
         : £/US$                     0.617     0.606        0.601*

*  Average for the second half of 1998.

17.  Litigation

The Group, through a number of its subsidiary undertakings, is
named in and is defending legal actions in various jurisdictions
arising from its normal business. No material adverse impact on
the financial position of the Group is expected to arise from
these proceedings.

18.  Substantial interests in share capital

No substantial interest, being 10 per cent or more, in the equity
share capital is recorded in the register maintained under
Section 16(1) of the Securities (Disclosure of Interests)
Ordinance.

19.  Dealings in HSBC Holdings shares

Save for dealings by HSBC Investment Bank plc, trading as an
intermediary in the Company's shares in London, neither the
Company nor any subsidiary undertaking has bought or sold any
shares of the Company during the six months ended 30 June 1999.

20.  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 1998 have been 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.

21.  Forward-looking Statements

This news release contains certain forward-looking
statements with respect to the financial condition, results
of operations and business of the Group. These forward-
looking statements represent the Group'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. For example,
certain of the market risk disclosures, some of which are
only estimates and therefore could be materially different
from actual results, are dependent on key model
characteristics and assumptions and are subject to various
limitations. Certain statements, such as those that include
the words 'potential', 'value at risk', 'estimated', and
similar expressions or variations on such expressions may be
considered 'forward-looking statements'.

22.  Interim report
Copies of the Interim Report will be sent to shareholders on 13
August 1999 and may be obtained from Group Corporate Affairs,
HSBC Holdings plc, 10 Lower Thames Street, London EC3R 6AE,
United Kingdom; The Hongkong and Shanghai Banking Corporation
Limited, 1 Queen's Road Central, Hong Kong; HSBC Bank USA, 140
Broadway, New York, New York 10005, USA, or from the HSBC website 
- www.hsbc.com.

A Chinese translation of the report may be obtained on request
from Central Registration Hong Kong Limited, Rooms 1901-5,
Hopewell Centre, 183 Queen's Road East, Hong Kong.

Custodians or nominees that wish to distribute copies of the
Interim Report to their clients may request copies for collection
by writing to Group Corporate Affairs at any of the addresses
given above. Requests must be received by no later than 9 August
1999.

23.  Review of Interim Financial Statements

The unaudited interim consolidated financial statements have been
reviewed by the Company's auditor, KPMG Audit Plc, and a report
of its review will be included in the Interim Report to
shareholders.