HSBC 2015 Annual Report Download - page 438

Notes on the Financial Statements (continued)
33 – Foreign exchange exposures / 34 – Non-controlling interests / 35 – Share capital
HSBC HOLDINGS PLC
436
33 Foreign exchange exposures
Structural foreign exchange exposures
HSBC’s structural foreign exchange exposures are represented by the net asset value of its foreign exchange equity and
subordinated debt investments in subsidiaries, branches, joint ventures and associates with non-US dollar functional
currencies. Gains or losses on structural foreign exchange exposures are recognised in other comprehensive income.
HSBC’s management of its structural foreign exchange exposures is discussed on page 171.
Net structural foreign exchange exposures
2015 2014
$m $m
Currency of structural exposure
Pound sterling1 32,701 30,071
Hong Kong dollars 28,270 24,028
Chinese renminbi 24,117 24,578
Euros 19,966 20,378
Mexican pesos 4,228 5,249
Indian rupees 3,645 3,466
Canadian dollars 3,595 4,187
Saudi riyals 3,109 2,910
Brazilian real 2,865 4,910
Swiss francs 2,642 1,864
Malaysian ringgit 1,994 2,219
UAE dirhams 1,898 2,199
Taiwanese dollars 1,702 1,721
Singapore dollars 1,454 1,185
Australian dollars 1,396 1,516
Indonesian rupiah 1,303 1,352
Korean won 1,296 1,360
Turkish lira 1,006 1,366
Egyptian pounds 925 868
Argentine pesos 875 1,059
Others, each less than $700m 5,775 5,918
At 31 December 144,762 142,404
1 During 2015, we entered into new forward exchange contracts amounting to $2.6bn (2014: $1.6bn) in order to manage our sterling structural foreign
exchange exposure.
Shareholders’ equity would decrease by $2,633m (2014: $2,522m) if euro and sterling foreign currency exchange rates
weakened by 5% relative to the US dollar.
34 Non-controlling interests
2015 2014
$m $m
Non-controlling interests attributable to holders of ordinary shares in subsidiaries 6,981 7,104
Preferred securities issued by subsidiaries 2,077 2,427
At 31 December 9,058 9,531
Preferred securities issued by subsidiaries
Preferred securities are securities for which there is no obligation to pay a dividend and, if the dividend is not paid, it 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 PRA and, where relevant, the consent of the local banking regulator. Dividends on 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 additional tier 1 capital and
cumulative preferred securities classified as tier 2 capital in accordance with CRD IV rules, by virtue of the application of
grandfathering provisions.