HSBC 2006 Annual Report Download - page 111

109
Guyerzeller and HSBC Trinkaus & Burkhardt,
provides the services noted below.
Utilising the most suitable products from the
marketplace, Private Banking works with its clients
to offer both traditional and innovative ways to
manage and preserve wealth while optimising
returns. Products and services offered include:
Investment services: These comprise both
advisory and discretionary investment services. A
wide range of investment vehicles is covered,
including bonds, equities, derivatives, options,
futures, structured products, mutual funds and
alternative products, such as hedge funds and fund of
funds. By accessing regional expertise located within
six major advisory centres in Hong Kong, Singapore,
Geneva, New York, Paris and London, Private
Banking seeks to select the most suitable
investments for clients’ needs and investment
strategies.
Global wealth solutions: These comprise
inheritance planning, trustee and other fiduciary
services designed to protect existing wealth and
create tailored structures to preserve wealth for
future generations. Areas of expertise include trusts,
foundation and company administration, charitable
trusts and foundations, insurance and offshore
structures.
Specialist advisory services: Private Banking
offers expertise in several specialist areas of wealth
management including tax advisory and financial
planning, family office advisory, corporate finance,
consolidated reporting, industry services such as
charities and foundations, media, shipping, diamond
and jewellery, and real estate planning. Specialist
advisers are available to deliver products and
services that are tailored to meet the full range of
high net worth clients’ individual financial needs.
General banking services: These comprise
treasury and foreign exchange, offshore and onshore
deposits, credit and specialised lending, tailor-made
loans and internet banking. Private Banking works to
ensure its clients have full access to relevant skills
and products available throughout HSBC, such as
corporate banking, investment banking and
insurance.
Property
At 31 December 2006, HSBC operated from some
10,200 operational properties worldwide, of which
approximately 3,200 were located in Europe, 700 in
Hong Kong and the Rest of Asia-Pacific, 2,300 in
North America and 4,000 in Latin America
(including 1,550 in Mexico). These properties had an
area of approximately 65.4 million square feet
(2005: 63.8 million square feet).
Freehold, long leasehold and short leasehold
land and buildings carried on the balance sheet
represented 40 per cent of HSBC’s operational
space. In addition, properties with a net book value
of US$1,949 million were held for investment
purposes. Of the total net book value of HSBC
properties, more than 78 per cent were owned or
held under long-term leases.
HSBC’s properties are stated at cost, being
historical cost or fair value at the date of transition to
IFRSs (their deemed cost) less any impairment
losses, and are depreciated on a basis calculated to
write off the assets over their estimated useful lives.
Properties owned as a consequence of an acquisition
are recognised initially at fair value.
Valuation of freehold and leasehold land and
buildings
HSBC’s freehold and long leasehold properties,
together with all leasehold properties in Hong Kong,
were valued in 2006. The value of these properties
was US$1.7 billion in excess of their carrying
amount in the consolidated balance sheet.
Further details are included in Note 23 on the
Financial Statements on page 366.
Legal proceedings
HSBC is party to legal actions in a number of
jurisdictions including the UK, Hong Kong and the
US, arising out of its normal business operations.
HSBC considers that none of the actions is regarded
as material, and none is expected to result in a
significant adverse effect on the financial position of
HSBC, either individually or in the aggregate.
Management believes that adequate provisions have
been made in respect of such litigation. HSBC has
not disclosed any contingent liability associated with
these legal actions because it is not practicable to do
so.