HSBC 2007 Annual Report Download - page 89

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Singapore, where treasury performance improved and
unfavourable positions unwound, and India, where
the recently launched business was successful in
attracting deposits.
Fee income increased by 62 per cent to
US$68 million, with significant growth in Singapore,
India and the Middle East. Initiatives to attract clients
to HSBC’s suite of discretionary managed products,
particularly the SIS and CIS products, proved
successful.
Trading and other operating income was slightly
lower than in 2005, due to sluggish stock market
performance and correspondingly subdued client
activity.
Client assets increased by 12 per cent to
US$16 billion, benefiting from the recruitment of
front office staff, client appetite for investment in
newly launched funds and the successful growth of
recently launched onshore businesses in the region.
Investment in funds benefited from higher demand
for HSBC and third party manager funds, including
the SIS and CIS products in which the value of client
investments grew to US$291 million. Higher deposits
and investments in equities also contributed to the
growth in client assets.
Operating expenses increased by 25 per cent,
reflecting continued investment in the onshore
Japanese operations and growth of the business in
India. Staff costs rose as competition for front-office
professionals intensified, putting upward pressure on
staff rewards, and the full-year impact of the
expansion in staff recruitment in 2005 fed through.
HSBC sold properties in Japan and India,
realising gains of US$87 million in Other,
US$77 million higher than in 2005. Costs and
recoveries in the GSCs both rose, reflecting increased
activity supported by higher staff numbers. Interest
rate rises and higher retained earnings led to a
doubling of earnings on centrally held funds.