HSBC 2007 Annual Report Download - page 375

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Changes in the present value of defined benefit obligations
HSBC Bank (UK) Pension Scheme Other plans
2007 2006 2007 2006
US$m US$m US$m US$m
At 1 January .................................................................. 24,332 20,587 7,916 7,102
Current service cost ...................................................... 454 456 347 304
Interest cost ................................................................... 1,247 1,055 398 366
Contributions by employees ......................................... – – 37 28
Actuarial (gains)/losses ................................................. (2,395) 30 475 211
Benefits paid ................................................................. (632) (696) (529) (386)
Past service cost – vested immediately ......................... – – 6 9
Acquisitions .................................................................. – – – 10
Reduction in liabilities resulting from curtailments ..... – – (63) (5)
Liabilities extinguished on settlements ........................ – – (16) (21)
Exchange differences .................................................... 506 2,900 302 298
At 31 December ............................................................ 23,512 24,332 8,873 7,916
Changes in the fair value of plan assets
HSBC Bank (UK) Pension Scheme Other plans
2007 2006 2007 2006
US$m US$m US$m US$m
At 1 January .................................................................. 20,587 17,396 7,116 6,356
Expected return on plan assets ...................................... 1,211 1,169 486 421
Contributions by HSBC ................................................ 1,058 240 211 193
– normal .................................................................... 471 240 199 160
– special .................................................................... 587 –12 33
Contributions by employees ......................................... – – 37 28
Experience gains ........................................................... 29 – 157 203
Benefits paid ................................................................. (632) (696) (467) (343)
Assets distributed on curtailments ................................ – – – (4)
Assets distributed on settlements .................................. – – (17) (14)
Exchange differences .................................................... 451 2,478 245 276
At 31 December ............................................................ 22,704 20,587 7,768 7,116
The actual return on plan assets for the year ended 31 December 2007 was US$1,883 million (2006:
US$1,793 million). HSBC expects to make US$671 million of contributions to defined benefit pension plans during
2008. Benefits expected to be paid from the plans to retirees over each of the next five years, and in aggregate for the
five years thereafter, are:
2008 2009 2010 2011 2012 2013-2017
US$m US$m US$m US$m US$m US$m
HSBC Bank (UK) Pension Scheme ..................... 712 726 770 801 853 5,419
Other significant plans .......................................... 446 448 467 504 548 3,084
Total expense recognised in the income statement in ‘Employee compensation and benefits’
HSBC Bank (UK) Pension Scheme Other plans
2007 2006 2005 2007 2006 2005
US$m US$m US$m US$m US$m US$m
Current service cost .................... 454 456 383 347 304 283
Interest cost ................................. 1,247 1,055 981 398 366 333
Expected return on plan assets ... (1,211) (1,169) (954) (486) (421) (401)
Past service cost .......................... – – – 7 11 (3)
(Gains)/losses on curtailments .... – – – (63) – (4)
(Gains)/losses on settlements....... – – – 1 – –
Total expense .............................. 490 342 410 204 260 208