HSBC 2013 Annual Report Download - page 12

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Operating expenses
2013
$m
2012
$m
Employee compensation and benefits ............................................................................ 614 659
General and administrative expenses ............................................................................. 408 409
Depreciation of property, plant and equipment .............................................................. 34 35
Amortization and impairment of intangible assets ........................................................ 14 19
Total operating expenses (excluding restructuring charges) .......................................... 1,070 1,122
Restructuring charges ..................................................................................................... –36
Total operating expenses ................................................................................................ 1,070 1,158
Total operating expenses (excluding restructuring
charges) for 2013 were $1,070m, a decrease of
$52m, or 5%, compared with 2012. Total operating
expenses decreased notably as a result of our on-going
organizational effectiveness programs, which resulted in
sustainable cost savings of $33m in 2013. Cumulative
sustainable cost savings from 2011 to the end of 2013
are in excess of $130m. Right sizing operations of the
bank’s consumer finance business further contributed to
the decrease in total operating expenses.
Restructuring charges of $36m were recognized in
the first quarter of 2012 primarily relating to the wind-
down of the bank’s consumer finance business. These
restructuring charges were not repeated in 2013.
Share of profit in associates
Share of profit in associates for 2013 was $31m, an
increase of $26m compared with 2012. Share of profit
in associates was higher due to an increase in value of
the bank’s investment in private equity funds.
Income tax expense
The effective tax rate was 26.7% for 2013, broadly
unchanged compared with 26.9% for 2012.
HSBC BANK CANADA
Management’s Discussion and Analysis (continued)
10