TIDM57HB
RNS Number : 0795A
Hongkong & Shanghai Banking Corp Ld
21 March 2017
31 Analysis of cash flows payable under financial liabilities by
remaining contractual maturities
Due between Due between
3 and 1 and
On Due within 12 5 Due after
demand 3 months months years 5 years Total
HK$m HK$m HK$m HK$m HK$m HK$m
At 31 December
2016
Hong Kong currency
notes
in circulation
.................. 242,194 - - - - 242,194
Items in the
course of transmission
to other banks
............................. - 37,753 - - - 37,753
Repurchase
agreements
- non-trading.................. 14,987 12,833 - - - 27,820
Deposits by
banks .............. 132,574 50,929 9,096 317 27 192,943
Customer accounts
............. 4,009,208 706,984 167,132 24,172 469 4,907,965
Trading liabilities
............... 188,470 - - - - 188,470
Derivatives
........................ 459,667 523 999 545 26 461,760
Financial liabilities
designated
at
fair value
........................ 206 56 4,594 10,437 36,330 51,623
Debt securities
in issue ....... - 2,170 7,658 12,412 4,455 26,695
Amounts due
to Group
companies....................... 47,847 66,251 2,199 10,088 95,265 221,650
Other financial
liabilities
.... 12,634 58,489 12,856 1,711 210 85,900
Subordinated
liabilities
........ - 29 933 313 4,356 5,631
Preference
shares ............... - 225 531 3,022 34,433 38,211
--------- ---------- ----------- ----------- --------- ---------
5,107,787 936,242 205,998 63,017 175,571 6,488,615
Loan commitments
........... 1,699,275 567,212 16,580 4,486 64 2,287,617
Financial guarantee
and credit
risk related
guarantee contracts
........ 64,017 - - - - 64,017
--------- ---------- ----------- ----------- --------- ---------
6,871,079 1,503,454 222,578 67,503 175,635 8,840,249
--------- ---------- ----------- ----------- --------- ---------
At 31 December
2015
Hong Kong currency
notes
in circulation
.................. 220,184 - - - - 220,184
Items in the
course of transmission
to other banks
............................. - 30,753 - - - 30,753
Repurchase
agreements
- non-trading.................. 6,385 9,890 - - - 16,275
Deposits by
banks .............. 128,562 15,950 1,410 2,343 84 148,349
Customer accounts
............. 3,643,166 779,904 192,808 33,562 666 4,650,106
Trading liabilities
............... 191,851 - - - - 191,851
Derivatives
........................ 366,823 382 929 946 - 369,080
Financial liabilities
designated
at
fair value
........................ 350 58 203 15,072 35,948 51,631
Debt securities
in issue ....... 7 5,588 7,165 26,005 4,696 43,461
Amounts due
to Group
companies....................... 34,532 55,185 750 2,229 22,221 114,917
Other financial
liabilities
.... 7,151 54,450 8,241 1,546 441 71,829
Subordinated
liabilities
........ - 3,150 73 1,152 4,224 8,599
Preference
shares ............... - 10,212 421 2,397 32,857 45,887
--------- ---------- ----------- ----------- --------- ---------
4,599,011 965,522 212,000 85,252 101,137 5,962,922
Loan commitments
........... 1,605,093 508,358 12,652 5,867 22 2,131,992
Financial guarantee
and credit
risk related
guarantee contracts
........ 63,812 - - - - 63,812
--------- ---------- ----------- ----------- --------- ---------
6,267,916 1,473,880 224,652 91,119 101,159 8,158,726
--------- ---------- ----------- ----------- --------- ---------
31 Analysis of cash flows payable under financial liabilities by
remaining contractual maturities (continued)
The balances in the above tables incorporates all cash flows
relating to principal and future coupon payments on an undiscounted
basis (except for trading liabilities and trading derivatives).
Trading liabilities and trading derivatives have been included in
the 'On demand' time bucket as trading liabilities are typically
held for short periods of time. The undiscounted cash flows payable
under hedging derivative liabilities are classified according to
their contractual maturity. Investment contract liabilities have
been included in financial liabilities designated at fair value,
whereby the policyholders have the options to surrender or transfer
at any time, and are reported in the "Due after 5 years" time
bucket. A maturity analysis prepared on the basis of the earliest
possible contractual repayment date (assuming that all surrender
and transfer options are exercised) would result in all investment
contracts being presented as falling due within one year or less.
The undiscounted cash flows potentially payable under loan
commitments and financial guarantee contracts are classified on the
basis of the earliest date they can be called. Cash flows payable
in respect of customer accounts are primarily contractually
repayable on demand or at short notice.
32 Reconciliation of operating profit to cash generated from
operations
2016 2015
HK$m HK$m
Operating profit
.............................................................................
.................................... 87,795 101,449
Net interest income
.............................................................................
.................................. (96,908) (94,377)
Dividend income
.............................................................................
....................................... (234) (210)
Depreciation and amortisation
.............................................................................
.................. 5,990 5,982
Amortisation of prepaid operating
lease payments
................................................................ 18 17
Loan impairment charges and other
credit risk provisions ..................................................... 5,554 5,074
Loans and advances written off net
of recoveries
................................................................... (3,870) (3,331)
Other provisions for liabilities
and charges
............................................................................. 261 1,016
Provisions used
.............................................................................
......................................... (268) (313)
Gains on investment properties
.............................................................................
................ (36) (480)
(Gains)/losses on disposal of property,
plant and equipment and assets held
for sale ............... 57 (134)
Gain on disposal of business portfolios
.............................................................................
...... (1) (23)
Impairment on interests in associates
and joint ventures......................................................... - 13
Gains less losses from financial
investments
........................................................................... (1,232) (11,611)
Share-based payments expense
.............................................................................
.................. 1,019 1,318
Movement in present value of in-force
business
..................................................................... (7,306) (4,689)
Interest received
.............................................................................
....................................... 106,416 110,427
Interest paid
.............................................................................
............................................. (25,385) (29,689)
Operating profit before changes
in working capital ..................................................... 71,870 80,439
Change in treasury bills with original
term to maturity of more than three
months ................ (43,439) (109,172)
Change in placings with and advances
to banks
...................................................................... (3,141) 24,012
Change in certificates of deposit
with original term to maturity of
more than three months .. 14,424 8,559
Change in repos and reverse repos
.............................................................................
............ (3,615) (11,842)
Change in trading assets
.............................................................................
............................ (61,369) 94,823
Change in trading liabilities
.............................................................................
....................... (3,381) (23,961)
Change in derivative assets
.............................................................................
....................... (98,852) 8,979
Change in derivative liabilities
.............................................................................
.................. 93,039 2,291
Change in financial assets designated
as fair value
.................................................................. (7,991) 170
Change in financial liabilities
designated as fair value
............................................................. 346 1,936
Change in financial investments
held for backing liabilities to
long-term policyholders .......... (34,928) (34,655)
Change in loans and advances to
customers
............................................................................ (73,374) 46,848
Change in amounts due from Group
companies
...................................................................... 1,623 (52,702)
Change in prepayment, accrued income
and other assets ........................................................ (56,582) 9,016
Change in deposits by banks
.............................................................................
...................... 44,185 (78,419)
Change in customer accounts
.............................................................................
.................... 259,928 160,084
Change in amounts due to Group companies
.......................................................................... 25,057 (23,128)
Change in debt securities in issue
.............................................................................
............... (15,624) (4,438)
Change in liabilities under insurance
contracts
........................................................................ 45,350 30,638
Change in accruals and deferred
income, other liabilities and provisions
................................. 49,560 25,015
Exchange adjustments
.............................................................................
............................... 7,526 14,015
Cash generated from operations
.............................................................................
......... 210,612 168,508
------------------------- ---------
33 Analysis of cash and cash equivalents
a Change in cash and cash equivalents during the year
2016 2015
HK$m HK$m
At 1 January
..................................................................................
................................ 658,397 679,670
Net cash inflow before the effect
of foreign exchange movements ................................. 108,266 5,652
Effect of foreign exchange movements
.......................................................................... (13,958) (26,925)
--------------------- --------
At 31 December
..................................................................................
........................... 752,705 658,397
--------------------- --------
b Analysis of balances of cash and cash equivalents in the consolidated balance sheet
2016 2015
HK$m HK$m
Cash in hand and sight balances
with central banks ......................................................... 213,783 151,103
Items in the course of collection
from other banks ........................................................ 21,401 25,020
Reverse repurchase agreements -
non-trading ................................................................ 167,872 124,351
Placings with and advances to banks
............................................................................... 311,734 279,297
Treasury bills, certificates of
deposit and other eligible bills
............................................ 75,668 109,379
Less: items in the course of transmission
to other banks ................................................ (37,753) (30,753)
--------------------- --------
752,705 658,397
--------------------- --------
The amount of cash and cash equivalents that are subject to
exchange control and regulatory restrictions amounted to
HK$182,494m at 31 December 2016 (2015: HK$151,255m).
34 Contingent liabilities and commitments
a Off-balance sheet contingent liabilities and commitments
2016 2015
HK$m HK$m
Contingent liabilities and financial
guarantee contracts
Guarantees and irrevocable letters
of credit pledged as collateral
security ........................... 257,863 256,561
Other contingent liabilities
............................................................................................
.... 1,696 1,371
--------- ---------
259,559 257,932
--------- ---------
Commitments
Documentary credits and short-term
trade-related transactions ......................................... 30,080 31,337
Forward asset purchases and forward
forward deposits placed ............................................. 6,235 4,821
Undrawn formal standby facilities,
credit lines and other commitments
to lend ................. 2,251,302 2,095,834
2,287,617 2,131,992
--------- ---------
The above table discloses the nominal principal amounts of
commitments excluding capital commitments, guarantees and other
contingent liabilities, which are mainly credit-related instruments
including both financial and non-financial guarantees and
commitments to extend credit. Contractual amounts represent the
amounts at risk should contracts be fully drawn upon and clients
default. The amount of the loan commitments shown above reflects,
where relevant, the expected level of take-up of pre-approved
facilities. Since a significant portion of guarantees and
commitments are expected to expire without being drawn upon, the
total of the contractual amounts is not representative of future
liquidity requirements.
34 Contingent liabilities and commitments (continued)
b Guarantees (including financial guarantee contracts)
The group provides guarantees and similar undertakings on behalf
of both third party customers and other entities within the Group.
These guarantees are generally provided in the normal course of
banking business. The principal types of guarantees provided, and
the maximum potential amount of future payments which the group
could be required to make, were as follows:
2016 2015
HK$m HK$m
Guarantees in favour of third parties
Financial guarantees (1)
.................................................................................................
...... 52,831 54,228
Other guarantees (2)
.................................................................................................
............ 183,160 180,933
------- -------
235,991 235,161
Guarantees in favour of
other HSBC Group entities
..................................................................................... 21,872 21,400
------- -------
257,863 256,561
------- -------
1 Financial guarantees are contracts that require the issuer to
make specified payments to reimburse the holder for a loss incurred
because a specified debtor fails to make payment when due in
accordance with the original or modified terms of a debt
instrument. The amounts in the above table are nominal principal
amounts.
2 Other guarantees include re-insurance letters of credit
related to particular transactions, trade-related letters of credit
issued without provision for the issuing entity to retain title to
the underlying shipment, performance bonds, bid bonds, standby
letters of credit and other transaction-related guarantees.
The amounts disclosed in the above table reflect the group's
maximum exposure under a large number of
individual guarantee undertakings. The risks and exposures from
guarantees are captured and managed in
accordance with HSBC's overall credit risk management policies
and procedures. Guarantees are subject to an annual credit review
process.
35 Other commitments
Capital commitments
At 31 December 2016, capital commitments, mainly related to the
commitment for purchase of premises, were HK$2,945m (2015:
HK$3,354m).
Lease commitments
The group leases certain properties and equipment under
operating leases. The leases normally run for a period of one to
ten years and may include an option to renew. Lease payments are
usually adjusted annually to reflect market rentals. None of the
leases include contingent rentals. Future minimum lease payments
under non-cancellable operating leases for premises and equipment
are as follows:
2016 2015
HK$m HK$m
Amounts payable within
- one year or less
.......................................................................................
........................... 2,974 3,054
- five years or less but over one
year
.................................................................................... 4,545 4,858
- over five years
.......................................................................................
............................ 658 779
--------- ---------------
8,177 8,691
--------- ---------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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