HSBC 2012 Annual Report Download - page 496

HSBC HOLDINGS PLC
Notes on the Financial Statements (continued)
37 – Non-controlling interests / 38 – Called up share capital and other equity instruments
494
relevant pool of assets. This is also the case where financial assets are placed with a custodian or settlement agent,
which has a floating charge over all the financial assets placed to secure any liabilities under settlement accounts.
These transactions are conducted under terms that are usual and customary to collateralised transactions, including,
where relevant, standard securities lending and repurchase agreements.
Collateral accepted as security for assets
The fair value of assets accepted as collateral that HSBC is permitted to sell or repledge in the absence of default
is US$295,709m (2011: US$302,285m). The fair value of any such collateral that has been sold or repledged was
US$202,662m (2011: US$188,682m). HSBC is obliged to return equivalent securities.
These transactions are conducted under terms that are usual and customary to standard securities borrowing and
reverse repurchase agreements.
37 Non-controlling interests
At 31 December
2012 2011
US$m US$m
Non-controlling interests attributable to holders of ordinary shares in subsidiaries ............................... 5,159 4,656
Preferred securities issued by subsidiaries ............................................................................................... 2,728 2,712
7,887 7,368
Preferred securities issued by subsidiaries
Preferred securities are securities for which there is no obligation to pay a dividend and, if not paid, the dividend
may not be cumulative. Such securities do not generally carry voting rights but rank higher than ordinary shares for
dividend payments and in the event of a winding-up. These securities have no stated maturity date but may be called
and redeemed by the issuer, subject to prior notification to the FSA and, where relevant, the consent of the local
banking regulator. Dividends on the floating rate preferred securities are generally related to interbank offer rates.
Included in the capital base of HSBC are non-cumulative preferred securities classified as tier 1 capital and
cumulative preferred securities classified as tier 2 capital in accordance with the rules and guidance in the FSA’s
GENPRU.
HSBC’s subsidiaries have the following preferred securities in issue:
At 31 December
First call
date
2012
US$m
2011
US$m
HSBC USA Inc.
US$150m Depositary shares each representing 25% interest in a share of
adjustable-rate cumulative preferred stock, series D .................................... Jul 1999 150 150
US$150m Cumulative preferred stock ................................................................................ Oct 2007 150 150
US$518m Floating rate non-cumulative preferred stock, series F ..................................... Apr 2010 518 518
US$374m Floating rate non-cumulative preferred stock, series G .................................... Jan 2011 374 374
US$374m 6.50% non-cumulative preferred stock, series H .............................................. Jul 2011 374 374
HSBC Finance Corporation
US$575m 6.36% non-cumulative preferred stock, series B ............................................... Jun 2010 559 559
HSBC Bank Canada
CAD175m Non-cumulative redeemable class 1 preferred shares, series C ........................ Jun 2010 176 171
CAD175m Non-cumulative class 1 preferred shares, series D ............................................ Dec 2010 176 171
CAD250m Non-cumulative 5 year rate reset class 1 preferred shares, series E .................. Jun 2014 251 245
2,728 2,712