[R]10:00AM New York-HSBC reported group pre-tax profit increased 10% to $24.2 billion from $22 billion from a year ago.[/R]

Second Half Earnings Review

HSBC reported that profits in the six months to December 31st increased 17% from the same comparative period a year ago to $8.24 billion as profits increased 35% in Europe and also in North America, while the Asia Pacific region increased 43%.

Pretax profit in the period grew 5% to $10.1 billion. Bad debts in the second half also increased 63% to $10.9 billion.

Annual Earnings Review

HSBC reported total operating income in the year ended December 31st rose 25% to $87 billion from $70 billion a year ago.

For the year, profit attributable to shareholders of the parent company grew 21% from $15 billion a year earlier to $19 billion. Earnings per share increased 17.9% to $1.65 from $1.40 per share a year ago.

Group pre-tax profit also jumped 10% to 24.2 billion from $22 billion a year earlier. Total dividends for the year increased 11.1% over 2006 to $0.90 per share.

Mature Markets

In France, HSBC has entered into discussions with regional French bank after receiving a firm cash offer of $3.1 billion for seven, separately branded, regional banks.

According to the bank, discussions on this subject will be completed in mid-2008 subject to regulatory approvals.

During 2007, the bank also acquired 50% equity in French insurance business Erisa.

Revenues

Commercial Banking

In the division, profit before tax increased 19% from 2006 to $7.1 billion, buoyed by strong growth in Asia-Pacific, the Middle East, and Latin America. Cross-sales of Global Markets’ foreign exchange products grew very strongly in these markets.

Resultantly, profits from emerging market increased 47% in 2006 to 52% in 2007.

During the year, HSBC extended the network of International Banking Centres across an additional 38 countries, bringing the total to 54.

Income climbed 18% in the payments and cash management, trade and supply chain businesses.

On the overall, Commercial Banking customer base jumped by 8% to 2.8 million in 2007, with notable increases in Hong Kong, UK and Turkey.

Personal Financial Services