HSBC 2008 Annual Report Download - page 272

HSBC HOLDINGS PLC
Report of the Directors: Risk (continued)
Insurance operations > Credit risk / Liquidity risk
270
Issuers of treasury bills, other eligible bills and debt securities in HSBC’s insurance subsidiaries
(Audited)
Treasury
bills
Other eligible
bills
Debt
securities Total
US$m US$m US$m US$m
At 31 December 2008
Governments ................................................................. 467 24 6,109 6,600
Local authorities ........................................................... – – 525 525
Asset-backed securities ................................................. – – 14 14
Corporates and other ..................................................... – 374 25,720 26,094
467 398 32,368 33,233
At 31 December 2007
Governments ................................................................. 388 – 7,140 7,528
Local authorities ........................................................... – – 175 175
Asset-backed securities ................................................. – – 201 201
Corporates and other ..................................................... – 348 21,579 21,927
388 348 29,095 29,831
(Audited)
Credit risk also arises when part of the insurance
risk incurred by HSBC is assumed by reinsurers. The
credit risk exposure to reinsurers is monitored by
Group Insurance Head Office and is reported
quarterly to the Group Insurance Risk Committee
and the Group Insurance Credit Risk Meeting.
The split of liabilities ceded to reinsurers and
outstanding reinsurance recoveries, analysed by
Standard & Poor’s reinsurance credit rating data or
their equivalent, is shown below. The Group’s
exposure to third parties under the reinsurance
agreement described in the Credit Risk section above
is included in this table.
Reinsurers’ share of liabilities under insurance contracts
(Audited)
Neither past due
nor impaired
Strong Medium
Past due
but not
impaired Total
US$m US$m US$m US$m
At 31 December 2008
Linked insurance contracts ............................................................................................. 9 947 – 956
Non-linked insurance contracts ...................................................................................... 1,001 62 4 1,067
Total1 ............................................................................................................................... 1,010 1,009 4 2,023
Reinsurance debtors ........................................................................................................ 30 20 10 60
At 31 December 2007
Linked insurance contracts ............................................................................................. 35 22 – 57
Non-linked insurance contracts ...................................................................................... 998 257 3 1,258
Total2 ............................................................................................................................... 1,033 279 3 1,315
Reinsurance debtors ........................................................................................................ 37 9 8 54
1 Does not include reinsurers’ share of liabilities under insurance contracts and reinsurance debtors of associated insurance company,
Ping An Insurance, or joint venture insurance companies, Hana Life and Canara HSBC Oriental Bank of Commerce Life Insurance
Company Limited.
2 Does not include reinsurers’ share of liabilities under insurance contracts and reinsurance debtors of insurance manufacturing
associate, Ping An Insurance.