HSBC 2012 Annual Report Download - page 411

409
Overview Operating & Financial Review Corporate Governance Financial Statements Shareholder Information
1 During 2011 the Group adopted a more stringent treatment for impaired loans for geographical regions with significant levels of
forbearance. As a result loans and advances have been classified as impaired that under the previous disclosure convention would
otherwise have been classified as neither past due nor impaired or past due but not impaired. The effect of this change on 2011 reported
numbers was to increase interest earned on impaired loans from US$0.3bn to US$1.5bn. Restatement of comparative data prior to
31 December 2010 is impracticable (see page 162, ‘Impaired loans disclosure’, for further details).
7 Employee compensation and benefits
2012 2011 2010
US$m US$m US$m
Wages and salaries ...................................................................................................... 17,780 18,923 17,193
Social security costs .................................................................................................... 1,633 1,754 1,567
Post-employment benefits .......................................................................................... 1,078 489 1,076
20,491 21,166 19,836
Average number of persons employed by HSBC during the year
2012 2011 2010
Europe ......................................................................................................................... 77,204 81,263 79,902
Hong Kong ................................................................................................................. 28,764 30,323 29,105
Rest of Asia-Pacific .................................................................................................... 88,015 92,685 89,737
Middle East and North Africa .................................................................................... 8,645 8,816 8,983
North America ............................................................................................................ 27,396 34,871 36,822
Latin America ............................................................................................................. 54,162 58,026 57,778
Total ............................................................................................................................ 284,186 305,984 302,327
Included in ‘Wages and salaries’ above are share-based payment arrangements, as follows:
Share-based payments income statement charge
2012 2011 2010
US$m US$m US$m
Restricted and performance share awards1 ................................................................. 912 1,041 685
Savings-related and other share option plans ............................................................. 96 121 127
1,008 1,162 812
Equity-settled share-based payments .......................................................................... 988 1,154 812
Cash-settled share-based payments ............................................................................ 20 8 –
1 Restricted share awards include awards granted under the Group Performance Share Plan (‘GPSP’).
The share-based payment income statement charge above includes US$837m (2011: US$974m; 2010: US$610m)
relating to deferred share awards. These awards are generally granted to employees early in the year following the
year to which the award relates. The charge for these awards is recognised from the start of the period to which the
service relates to the end of the vesting period. The vesting period is the period over which the employee satisfies
certain service conditions in order to become entitled to the award. Due to the staggered vesting profile of certain
deferred share awards, the employee becomes entitled to a portion of the award at the end of each year during the
vesting period. The income statement charge reflects this vesting profile.
In addition, wages and salaries also includes US$111m (2011: US$88m; 2010: US$15m) in respect of deferred cash
awards for current and prior performance years. The reconciliation of total incentive awards (both deferred and non-
deferred) to income statement charge is as follows: