HSBC 2006 Annual Report Download - page 348

HSBC HOLDINGS PLC
Notes on the Financial Statements (continued)
Notes 13 and 14
346
Year ended 31 December 2004
Personal
Financial
Services
Commercial
Banking
Corporate,
Investment
Banking
& Markets
Private
Banking Other
Intra-
HSBC
items Total
US$m US$m US$m US$m US$m US$m US$m
Net interest income ..................... 21,422 4,875 3,994 718 90 – 31,099
Net fee income ............................ 6,406 2,645 2,764 962 171 – 12,948
Trading income ........................... 320 234 1,935 257 40 – 2,786
Net investment income on
assets backing policy-
holders’ liabilities ................... 635 324 9 – 44 – 1,012
Gains less losses from financial
investments ............................. 79 6 197 39 219 – 540
Dividend income ......................... 16 37 548 5 16 – 622
Net earned insurance premiums . 3,652 1,072 86 – 558 – 5,368
Other operating income .............. 360 513 1,029 24 2,050 (2,363) 1,613
Total operating income ............... 32,890 9,706 10,562 2,005 3,188 (2,363) 55,988
Net insurance claims incurred
and movement in
policyholders’ liabilities ......... (2,953) (1,264) (59) – (359) – (4,635)
Net operating income1 ................ 29,937 8,442 10,503 2,005 2,829 (2,363) 51,353
Loan impairment (charges)/
recoveries and other credit
risk provisions ........................ (6,500) (200) 499 11 (1) – (6,191)
Net operating income2 ................ 23,437 8,242 11,002 2,016 2,828 (2,363) 45,162
Operating expenses ..................... (15,009) (4,220) (5,809) (1,319) (2,493) 2,363 (26,487)
Operating profit .......................... 8,428 4,022 5,193 697 335 – 18,675
Share of profit in associates
and joint ventures ................... 69 35 95 – 69 – 268
Profit before tax .......................... 8,497 4,057 5,288 697 404 – 18,943
Capital expenditure incurred3 ..... 1,415 614 1,919 142 538 – 4,628
1 Net operating income before loan impairment (charges)/recoveries and other credit risk provisions.
2 Net operating income:
External .................................. 22,760 7,419 12,239 1,704 1,040 – 45,162
Inter-segment .......................... 677 823 (1,237) 312 1,788 (2,363) –
3 Expenditure incurred on property, plant and equipment and intangible assets.
14 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.