FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a - 16 or 15d - 16 of
the Securities Exchange Act of 1934
For the month of May, 2008
HSBC Holdings plc
42nd Floor, 8 Canada
Square, London E14 5HQ, England
(Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F).
Form 20-F X Form 40-F ......
(Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934).
Yes....... No X
(If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): 82- ..............)
HSBC BANK MALAYSIA BERHAD
RESULTS FOR THE FIRST QUARTER 2008 - HIGHLIGHTS
- Profit before taxation for the first quarter of 2008 was MYR348 million,
13.0 per cent higher than the MYR308 million reported for the same period in
2007.
- Profit before allowance for losses on loans and financing increased by
25.7 per cent to MYR397 million for the three months ended 31 March 2008
compared with MYR316 million for the same period in 2007, mainly
attributable to higher other operating income.
- Other operating income in the first quarter of 2008 was up 49.2 per cent
to MYR303 million (MYR203 million for the same period in 2007) as trading
profits rose as a result of increased hedging activities by corporate
customers stemming from the volatility of the Malaysian ringgit against
other major currencies.
- Allowance for losses on loans and financing of MYR49 million was up
MYR41 million for the three months ended 31 March 2008 due to a lower rate
of recoveries than in the same period in 2007.
- Cost efficiency ratio for the three months ended 31 March 2008 improved
to 38.1 per cent from 40.6 per cent for the corresponding period in 2007.
- Total assets of MYR50.3 billion up MYR2.2 billion, or 4.4 per cent, at
31 March 2008 compared with MYR48.1 billion at 31 December 2007.
Commentary
HSBC Bank Malaysia Berhad posted strong growth in revenue of 17.6 per cent and
profit before allowance for losses on loans and financing of 25.7 per cent for
the three months ended 31 March 2008 compared to the corresponding period last
year. There was an improvement in all major income streams, with other operating
income being the main catalyst behind the growth figures.
Pre-tax profit grew MYR40 million in the first quarter of 2008, an increase of
13 per cent on the same period in 2007. This was despite the significant
increase in allowance for losses on loans and financing for the three months
ended 31 March 2008 when compared to the same period in 2007 which saw higher
recoveries in corporate lending portfolios.
Net interest income for the three months ended 31 March 2008 grew by 2.6 per
cent or MYR7 million, to MYR281 million (three months to 31 March 2007: MYR274
million). This was principally driven by an increase in lending, (up MYR2.8
billion or 11.5 per cent to MYR26.8 billion at 31 March 2008 from MYR24.0
billion at 31 March 2007), mainly in trade financing products, offset by tighter
margins.
Other operating income for the three months ended 31 March 2008 increased to
MYR303 million, up 49.2 per cent or MYR100 million compared to the corresponding
period in 2007. This was mainly a result of the increase of MYR74 million in
trading profits recorded for the three months ended 31 March 2008 as the
Malaysian ringgit remained volatile against other major currencies, resulting in
higher hedging activities by corporate customers. Other operating income was
further boosted by a gain of MYR22 million realised from the mandatory partial
redemption of Visa Inc. ("Visa") shares pursuant to Visa's initial public
offering in March 2008.
Other operating expenses for the first three months of 2008 increased by 13.4
per cent, or MYR29 million, to MYR245 million compared with the same period in
2007 (MYR216 million) mainly due to higher personnel costs (up MYR18 million or
16.6%) as the bank expanded its workforce, and other operating expenses.
The cost efficiency ratio for the three months ended 31 March 2008 improved to
38.1 per cent from 40.6 per cent in the same period last year as a result of
stronger growth in all major income streams while other operating expenses grew
at a slower pace.
Total assets as at 31 March 2008 grew by MYR2.2 billion or 4.4 per cent compared
to 31 December 2007. Customer deposits grew by MYR 2.4 billion or 6.5 per cent
during the same period as liquidity in the banking sector remained high. The
increase in assets was mainly attributable to higher holdings of securities held
for trading, up MYR1.6 billion or 131.2 per cent to MYR2.9 billion compared to
31 December 2007.
Irene Dorner, deputy chairman and CEO of HSBC Bank Malaysia Berhad, commented:
"HSBC Bank Malaysia Berhad continues to grow in all major income streams even as
margins remain tight due to intense competition and excess liquidity in the
domestic banking sector. The positive results reflect the confidence customers
have in the HSBC brand and the success of the bank's broad based business
strategy.
"The Malaysian economy is projected to grow at between five and six per cent in
2008 on the back of Malaysia's strong economic fundamentals, diversified exports
base and the relatively low exposure of the local financial institutions to the
US sub-prime market. The bank remains in a good position to capitalise on future
business opportunities.
"The bank will continue to implement its organic growth strategy in areas with
high potential, with particular focus on the setting up of its Islamic banking
subsidiary, HSBC Amanah Malaysia Berhad, in the second half of 2008. The opening
of new Islamic banking branches will expand the bank's geographical reach,
enable it to enter a totally different market segment and allow it to increase
its competitive advantage in the local financial services industry."
UNAUDITED CONDENSED BALANCE SHEET AS AT 31 MARCH 2008
Group Bank
Figures in MYR '000s 31Mar08 31Dec07 31Mar08 31Dec07
Assets
Cash and short-term funds 10,387,809 11,321,351 10,387,809 11,321,351
Securities purchased under
resale agreements 2,828,827 1,858,579 2,828,827 1,858,579
Deposits and placements
with banks and other
financial institutions 1,258,003 1,448,953 1,258,003 1,448,953
Securities held-for-trading 2,858,565 1,236,193 2,858,565 1,236,193
Securities available-for-
sale 3,504,848 4,272,517 3,504,848 4,272,517
Loans, advances and
financing 26,797,838 26,007,124 26,797,838 26,007,124
Other assets 1,581,295 897,653 1,581,295 897,653
Statutory deposits with
Central Bank Malaysia 650,547 704,847 650,547 704,847
Investment in subsidiaries - - 21 21
Prepaid land lease payments 20,772 20,890 20,772 20,890
Property, plant and equipment 252,688 258,290 252,688 258,290
Intangible assets 44,538 41,869 44,538 41,869
Deferred tax assets 75,932 69,675 75,932 69,675
Total assets 50,261,662 48,137,941 50,261,683 48,137,962
Liabilities
Deposits from customers 38,535,172 36,173,674 38,535,193 36,173,695
Deposits and placements
of banks and other
financial institutions 4,115,989 4,583,066 4,115,989 4,583,066
Bills and acceptances
payable 491,949 627,730 491,949 627,730
Other liabilities 2,196,800 1,815,550 2,196,800 1,815,550
Recourse obligation on
loans sold to Cagamas
Berhad 743,675 759,101 743,675 759,101
Provision for taxation 81,929 57,569 81,929 57,569
Subordinated bonds 993,573 1,000,000 993,573 1,000,000
Total liabilities 47,159,087 45,016,690 47,159,108 45,016,711
Shareholders' funds
Share capital 114,500 114,500 114,500 114,500
Reserves 2,988,075 2,756,751 2,988,075 2,756,751
Proposed dividend - 250,000 - 250,000
Shareholders' funds 3,102,575 3,121,251 3,102,575 3,121,251
Total liabilities and
shareholders' funds 50,261,662 48,137,941 50,261,683 48,137,962
Commitments and
contingencies 78,842,053 76,966,309 78,842,053 76,966,309
UNAUDITED CONDENSED INCOME STATEMENT FOR THE FIRST FINANCIAL QUARTER ENDED
31 MARCH 2008
Group and Bank
Figures in MYR '000s 31Mar08 31Mar07
Revenue 906,307 770,798
Interest income 518,179 483,304
Interest expense (237,509) (209,614)
Net interest income 280,670 273,690
Other operating income 302,550 202,794
Income from Islamic banking operations 58,388 55,040
Operating income 641,608 531,524
Other operating expenses (244,654) (215,689)
Profit before allowance 396,954 315,835
Allowance for losses on loans and financing (48,911) (7,718)
Profit before taxation 348,043 308,117
Taxation (95,054) (86,270)
Profit attributable to shareholders 252,989 221,847
Earnings per MYR0.50 ordinary share
- basic/diluted 110.5 sen 96.9 sen
Note: The financial statements of HSBC Bank Malaysia Berhad have been prepared
in accordance with the applicable approved accounting standards issued by the
Malaysian Accounting Standards Board.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
HSBC Holdings plc
By:
Name: P A Stafford
Title: Assistant Group Secretary
Date: 09 May 2008