HSBC 2001 Annual Report Download - page 229

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million (2000: US$1,797 million) and the unrecognised losses were US$2,506 million (2000: US$1,318
million).
Unrecognised gains of US$1,217 million and unrecognised losses of US$983 million are expected to be
recognised in 2002.
Of the gains and losses included in the profit and loss account in 2001, US$887 million gains and US$603
million losses were unrecognised at 1 January 2001.
(d) Liquidity management
HSBC’ s liquidity management process is discussed in the ‘Financial Review’ section on page 112 from the
paragraph under the heading Liquidity management to the bullet point ‘maintenance of liquidity contingency
plans’ .
39 Memorandum Items
(a) HSBC
2001 2000
Contract
amount
Credit
equivalent
amount
Risk-
weighte
d
amoun
t
Contract
amount
Credi
t
equivalen
t
amoun
t
Risk-
weighte
d
amount
US$m US$m US$m US$m US$m US$m
Contingent liabilities:
Acceptances and endorsements...... 4,219 2,840 2,792 5,160 3,171 3,119
Guarantees and assets pledged as
collateral security:
– guarantees and irrevocable
letters of credit ........................ 39,817 30,428 24,700 33,968 26,110 23,298
Other contingent liabilities............. 99914 14 12
44,045 33,277 27,501 39,142 29,295 26,429
Commitments:
Documentary credits and short-
term trade-related transactions ... 5,580 1,917 1,125 6,513 2,183 1,323
Forward asset purchases and
forward forward deposits placed 1,669 1,669 106 655 655 294
Undrawn note issuing and
revolving underwriting facilities 381 156 191 302 152 151
Undrawn formal standby facilities,
credit lines and other
commitments to lend:
– over 1 year .............................. 35,156 17,690 16,106 36,567 18,284 17,070
– 1 year and under...................... 155,673 –
–
138,679
–
–
198,459 21,432 17,528 182,716 21,274 18,838
The table above gives the nominal principal amounts, credit equivalent amounts and risk-weighted amounts of
off-balance-sheet transactions. The credit equivalent amounts are calculated for the purposes of deriving the
risk-weighted amounts. These are assessed in accordance with the Financial Services Authority’ s guidelines
which implement the 1988 Basel Capital Accord on capital adequacy and depend on the status of the
counterparty and the maturity characteristics.
Contingent liabilities and commitments are credit-related instruments which include acceptances, letters of
credit, guarantees and commitments to extend credit. The contractual amounts represent the amounts at risk