HSBC 2007 Annual Report Download - page 447

445
Interest and dividends
HSBC HSBC Holdings
2007 2006 2005 2007 2006
US$m US$m US$m US$m US$m
Interest paid ................................................................. (63,626) (47,794) (33,974) (2,397) (1,870)
Interest received .......................................................... 103,393 85,143 65,799 1,627 1,287
Dividends received ..................................................... 1,833 1,525 808 9,187 7,433
41 Contingent liabilities, contractual commitments and guarantees
HSBC
HSBC Holdings
2007
2006 2007 2006
US$m US$m US$m US$m
Contingent liabilities and guarantees
Guarantees and irrevocable letters of credit
pledged as collateral security ............................... 77,885 77,410 38,457 17,605
Other contingent liabilities ....................................... 334 330 – –
78,219 77,740 38,457 17,605
Commitments
Documentary credits and short-term trade-related
transactions ........................................................... 13,510 9,659 – –
Forward asset purchases and forward forward
deposits placed ..................................................... 490 2,077 – –
Undrawn note issuing and revolving
underwriting facilities .......................................... 109 213 – –
Undrawn formal standby facilities, credit lines
and other commitments to lend:
– 1 year and under1.............................................. 616,167 584,167 2,913 2,920
– over 1 year1 ...................................................... 134,181 118,514 725 1,047
764,457 714,630 3,638 3,967
1 Based on original maturity.
The above table discloses the nominal principal amounts of contingent liabilities, commitments and guarantees. They
are mainly credit-related instruments which include both financial and non-financial guarantees and commitments to
extend credit. Nominal principal amounts represent the amounts at risk should contracts be fully drawn upon and
clients default. The amount of the loan commitments shown above reflects, where relevant, the expected level of
take-up of pre-approved loan offers made by mailshots to personal customers. Since a significant portion of
guarantees and commitments are expected to expire without being drawn upon, the total of the nominal principal
amounts is not representative of future liquidity requirements.
Guarantees
HSBC provides guarantees and similar undertakings on behalf of both third party customers and other entities within
the HSBC Group. These guarantees are generally provided in the normal course of HSBC’s banking business. The
principal types of guarantees provided, and the maximum potential amount of future payments which HSBC could be
required to make at 31 December 2007, were as follows: