HSBC 2007 Annual Report Download - page 371
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369
Post-employment defined benefit plans’ principal actuarial financial assumptions
The principal actuarial financial assumptions used to calculate the Group’s obligations under its defined benefit
pension and post-employment healthcare plans at 31 December 2007, were as follows. These assumptions will also
form the basis for measuring periodic costs under the plans in 2008:
Healthcare cost trend
Discount
rate
Inflation
rate
Rate of
increase for
pensions1
Rate
of pay
increase
Initial
rate
Ultimate
rate
Year of
ultimate
rate
% % % % % %
UK .........................................
.
5.8 3.3 3.3 4.3 7.3 7.3 n/a
Hong Kong ............................
.
3.45 n/a n/a 5.02 n/a n/a n/a
US .........................................
.
6.55 2.5 n/a 3.75 9.6 5.0 2014
Jersey .....................................
.
5.8 3.3 3.3 5.05 n/a n/a n/a
Mexico ..................................
.
7.88 3.5 2.0 4.5 6.0 6.0 n/a
Brazil .....................................
.
10.75 4.5 4.5 4.5 10.5 5.5 2017
France ....................................
.
5.5 2.0 2.0 3.0 6.0 6.0 n/a
Canada ..................................
.
5.43 2.5 n/a 3.86 9.0 4.9 2012
Switzerland ...........................
.
3.3 1.5 n/a 2.38 n/a n/a n/a
Germany ................................
.
5.5 2.0 2.0 3.0 n/a n/a n/a
1 Rate of increase for pensions in payment and deferred pension.
The principal actuarial financial assumptions used to calculate the Group’s obligations under its defined benefit
pension and post-employment healthcare plans at 31 December 2006, were as follows. These assumptions also
formed the basis for measuring periodic costs under the plans in 2007:
Healthcare cost trend
Discount
rate
Inflation
rate
Rate of
increase for
pensions1
Rate
of pay
increase
Initial
rate
Ultimate
rate
Year of
ultimate
rate
% % % % % %
UK .........................................
.
5.1 3.0 3.0 4.0 7.0 7.0 n/a
Hong Kong ............................
.
3.75 n/a n/a 3.0 n/a n/a n/a
US .........................................
.
5.9 2.5 n/a 3.75 10.5 5.0 2014
Jersey .....................................
.
5.1 3.0 3.0 4.75 n/a n/a n/a
Mexico ..................................
.
8.0 3.5 2.0 4.0 6.75 6.75 n/a
Brazil .....................................
.
10.75 4.5 4.5 4.5 11.0 5.5 2016
France ....................................
.
4.5 2.0 2.0 3.0 6.0 6.0 n/a
Canada ..................................
.
5.19 2.5 n/a 3.47 9.9 4.9 2012
Switzerland ...........................
.
2.25 1.5 n/a 2.25 n/a n/a n/a
Germany ................................
.
4.5 2.0 2.0 3.0 n/a n/a n/a
1 Rate of increase for pensions in payment and deferred pension.