FORM 6

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  February, 2009

 

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- ..............).

 

 




The following is the text of an advertisement which is to be published in the press in Malta on 
21 February 2009
 by HSBC Bank 
Malta
 p.l.c., a 70.03 per cent indirectly held subsidiary of HSBC Holdings plc.


20 February 2009

HSBC BANK 
MALTA
 p.l.c.
2008 RESULTS - HIGHLIGHTS


Review of Performance








  
Commentary

HSBC Bank 
Malta
 and its subsidiaries
 delivered a 
profit before tax
 in 2008
 of €96.
1
 million
. 
While
 this represents a decline of 16.
2
 per cent compared to 2007,
it was 
a solid result achieved 
after taking into account
 
the introduction of the euro and the volatility of world financial markets. Overall
, profitability was still
 strong with a return on equity of 22.3 per cent.

Net interest income of €123.0 million
 
in 2008
 
was down
 2.5 per cent
,
 
from
 €126.2 million 
in 2007
. 
Increases in
 loans and advances 
generated 
steady growth
 in interest receivable. This was off-set by the increase in interest payable on retail 
deposits
,
 and m
argin pressure
 from 
a combination of increased 
competition
 and
 
the 
lower
ing of
 base rates
 
by 
the
 
ECB in the last quarter of 2008.

Net f
ees and commission income of €
31.8
 million 
in 2008, compared to €31.0 million
 
in
 
2007
, 
was achieved
 despite reduced levels of business activity during the first quarter of 2008
 
following
 
Malta
'
s adoption of the euro on 1 January 2008 and the general elections. Adopting the euro also affected foreign exchange dealing income
 which
,
 at €
7.9
 million, was significantly lower than the €
16.7
 million earned 
in the previous
 year.

Strong organic growth in sales of regular premium term life and investment products, and flat costs contributed to the life insurance business generating a profit before tax of €16.4 million in 2008, up 25.0 per cent on 2007.
 
The 
loss
 of €29.4
 million
 in 
n
et income from insurance financial instrum
ents designated at fair value 
was
 offset
 by a 
corresponding increase
 in 
o
ther operating income
,
 
a
 reduction in 
n
et insurance claims incurred and movement in policyholders
'
 liabilities. 

During the year, 
gains from property disposals and a revaluation gain on investment property
 
generated €3.5
 mil
lion in other operating income.

Operating expenses of €
90.4
 million
 
in 2008 were
 
€6.7 million
,
 or 
8
.
1
 per cent
,
 higher compared to the 
previous year
,
 with a cost efficiency ratio of 
48.0
 
per cent compared to 
42.1
 per cent in 2007. 
Employee compensation and benefits increased by €5.6 million
 in 2008
 primarily due to an exceptional charge to support
 a voluntary early retirement scheme. 
General and administrative e
xpense growth
 of €1.0 million
 
was driven 
primarily 
by non-recurring costs related to the euro co
nversion and
 information technology investment
,
 as well as utility and communications expenditure
. 
S
tripping out 
the costs incurred by the 
e
uro conversion and
 
voluntary retirement scheme
,
 
operating expenses
 remained flat
 year-
on
-
year
. 

The n
et impai
rment charge of €1.9 million 
was six
 basis points 
of loans and 
advances to customers. The 
year-
on
-
year increase 
was 
mainly
 due to
 
the non-recurrence of the high levels of recoveries experienced during 
2007
.


L
oans and advances to customers 
increased
 by 
€
289.9
 million
 in 2008
 to €3,112.2 million
, 
from €
2,822.3 million
 in 2007
,
 with
 growth 
across 
both the personal and commercial sectors
. 
The quality of the overall loan book remains good with non-
performing loans 
at the 2008 year end 
representing 
2.
3
 per cent of 
gross
 loans
,
 
an improvement from 
2.
7
 per cent at the end of 2007
.

Short-term liquid money market placements in the form of loans and advances to banks increased by €441.3 million to €1,072.3 million as 
more
 
new
 funds 
and maturing liquidity 
were placed 
with
 HSBC
 
as a result of 
increasing
 market risks
.

In these
 challenging 
times
, the 
a
vailable-for-
s
ale investments portfolio was marked down by €9.7 million 
during
 the year. 
HSBC Malta believe
s
 that the credit quality of these assets remains strong and that this deficit will reverse over the long-term.
 The mark-down was charged to revaluation reserves, net of tax.

The 
capital adequacy
 ratio, on a Basel II basis, remained strong at 11.0 per cent. 
In September 2008, the b
ank issued a €30.0 million
,
 5.9 per cent
,
 
subordinated bond 
to 
further 
strengthen
 
its
 
funding base and
 to
 support
 future business growth. 

Alan Richards, 
d
irector and 
c
hief 
e
xecutive 
o
fficer
 of
 HSBC Bank 
Malta
, said: 
"
It
 will be a particularly challenging year
 in 2009
 as many parts of the world head into a recession 
which 
will leave its mark on 
Malta
. Profitability will be under pressure as the economy slows, margins contract 
further 
in a low interest rate environment and impairments are likely to incr
ease as the credit cycle 
continues to weaken
.

"
Whil
st
 
some of the challenges we face may be unprecedented
,
 we are in 
good
 
shape. 
I am confident that with our track record, the backing of 
the
 
HSBC Group, our enduring commitment to liquidity, strong capital and a conservative approach to risk management, we are well positioned to build
 
on
 our strengths and support
 our customers to drive
 future growth
.

"
The
 financial
 
result for 2008
 
is
 a testimony to the hard work and professionalism of our staff during these trying times.
"

T
he Board is declaring a final
 gross dividend of 
€0.
096
 per share 
(
€0.
062
 
net of tax). This will be paid on 
20 April 2009 
to shareholders who are on the bank
'
s register of
shareholders 
at 4 
March 
2009
. This, together with the gross interim ordinary dividend of 
€0.
119 per share
,
 results in a total gross dividend for the year of 
€0.
215
.


Income statements for the year 1 January
2008
to 31 December 2008
 
 
 
 
 
 
Group
Bank
 
2008 
2007 
2008 
2007
 
€000 
€000 
€000 
€000
Interest receivable and similar income
 
 
 
 
– on loans and advances, balances with Central Bank of
   Malta, Treasury Bills and other instruments
224,031 
217,587 
223,907 
217,671 
– on debt and other fixed income instruments
21,479 
19,993 
21,376 
19,993 
Interest payable
(122,466)
 (111,342)
(124,623)
(113,107)
Net interest income
123,044 
126,238 
120,660 
124,557 
 
 
 
 
 
Fees and commissions receivable
34,332 
33,289 
28,498 
26,972 
Fees and commissions payable
(2,567)
(2,294)
(1,955)
(1,808)
Net fee and commission income
31,765 
30,995 
26,543 
25,164 
 
 
 
 
 
Dividend income
69 
328 
1,504 
9,655 
Trading profits
7,802 
16,785 
7,802 
16,785 
Net income from insurance financial instruments designated at fair value through profit or loss
 (29,407)
35 
- 
- 
Net gains on sale of available-for-sale financial assets
2,787 
3,538 
2,725
3,538 
Net earned insurance premiums
58,032 
73,249 
- 
- 
Other operating income
31,779 
15,844 
3,749 
4,279 
Total operating income
225,871 
267,012 
162,983 
183,978 
 
 
 
 
 
Net insurance claims incurred and movement in policyholders’ liabilities
(37,570)
(68,321)
- 
- 
Net operating income
188,301 
198,691 
162,983 
183,978 
 
 
 
 
 
Employee compensation and benefits
(55,477)
(49,840)
(52,991)
(47,533)
General and administrative expenses
(27,743)
(26,732)
(26,168)
(24,927)
Depreciation
(5,951)
(6,026)
(5,920)
(5,991)
Amortisation of intangible assets
(1,238)
(1,044)
(1,011)
(780)
Other operating charges
- 
(30)
- 
(30)
Net operating income before impairment charges and   provisions
97,892 
115,019 
76,893 
104,717 
Net impairment
(1,907)

(42) 
(1,907)

(42) 
Reversals/(provisions) for liabilities and other charges
102 
(340)
103 
(305)
Profit before tax
96,087 
114,637 
75,089 
104,370
Tax expense
(32,972)
(38,322)
(25,706)
(33,458)
Profit attributable to shareholders of the bank
63,115 
76,315 
49,383 
70,912
 
 
 
 
 
Earnings per share
21.6c
26.1c
16.9c
24.3c
 
 
 
 
 



 



Balance sheets at 31 December 2008
 
Group
Bank
 
 2008 
 2007 
 2008 
 2007 
 
€000 
€000 
€000 
€000 
Assets
 
 
 
 
Balances with Central Bank of Malta,   Treasury Bills and cash
130,682 
472,136 
130,681 
472,136 
Cheques in course of collection
9,308 
3,103 
9,308 
3,103 
Financial assets held for trading
11,823 
15,980 
12,057 
15,980 
Financial assets designated at fair value   through profit or loss
279,714 
275,695 
- 
- 
Financial investments
429,912 
456,525 
412,016 
452,008 
Loans and advances to banks
1,072,306 
631,018 
1,072,269 
630,936 
Loans and advances to customers
3,112,240 
2,822,315 
3,112,240 
2,822,315 
Shares in subsidiary companies
- 
- 
35,707 
29,541 
Intangible assets
64,256 
36,110 
1,797
1,363 
Property and equipment
70,684 
77,820 
70,731 
77,857 
Investment property
14,050 
12,885 
11,647 
10,482 
Assets held for sale
9,168 
11,922 
9,317 
12,071 
Current tax recoverable
2,966 
2,596 
2,164 
1,887 
Deferred tax assets
15,916 
11,553 
15,726 
11,548 
Other assets
25,824 
25,855 
8,425 
8,938 
Prepayments and accrued income
47,239 
39,576 
44,598 
36,571 
Total assets
5,296,088 
4,895,089 
4,948,683 
4,586,736 
 
 
 
 
 
Liabilities
 
 
 
 
Financial liabilities held for trading
11,381 
15,043 
12,375 
15,239 
Amounts owed to banks
462,185 
87,142 
462,185 
87,142 
Amounts owed to customers
4,016,632 
4,039,492 
4,073,875 
4,107,994 
Provision for current tax
688 
11,043 
- 
4,294 
Deferred tax liabilities
17,600 
12,361 
- 
- 
Liabilities to customers under investment contracts
15,122 
18,947 
- 
- 
Liabilities under insurance contracts issued
311,250 
290,943 
- 
- 
Other liabilities
36,734 
32,303 
33,883 
29,294 
Accruals and deferred income
53,930 
53,147
53,839 
52,374 
Provisions for liabilities and other charges
312 
414 
277 
380 
Subordinated liabilities
87,777 
57,962 
87,777 
57,962 
Total liabilities
5,013,611 
4,618,797 
4,724,211 
4,354,679 
Equity
 
 
 
 
Called up share capital
87,552 
84,976 
87,552 
84,976 
Revaluation and other reserves
15,149 
24,614 
15,314 
24,764 
Retained earnings
179,776 
166,702 
121,606 
122,317 
Total equity
282,477
276,292 
224,472 
232,057 
Total liabilities and equity
5,296,088 
4,895,089 
4,948,683
4,586,736 
Memorandum items
 
 
 
 
Contingent liabilities
129,925 
129,972 
129,948 
129,995 
Commitments
1,110,572 
1,148,034 
1,110,572 
1,148,034 


 


The financial
 statements were approved by the Board of Directors on 20 February 2009 and signed on its behalf by:

Albert Mizzi, 
Chairman
    
    
    
       
Alan Richards, 
Chief Executive Officer

Statements of changes in equity for the year 1 January 2008 to 31 December 2008




Called up
share capital
Revaluation and other
 
r
eserves

Retained 
earnings

Total
 equity

Group

€000 

€000 

€000 

€000 

At 1 January 2008

84,976 

24,614 

166,702 

276,292 
Release of net gains on a
vailable-for
  sale assets transferred to the income
  statement on disposal
   

 -
   

(
876
) 


-


 (8
76
)
Net fair value adjustments on financial
  investments

-

(6,
263
) 

-

(
6,263
)
Release of revaluat
ion reserve on
  disposal of
properties

-

(2,326)

2,326

-
Income and expenses
 
recognised directly
  in equity

-

(9,465
)

2,326

(7,
139
)

Increase in paid-up value

Profit for the year

2,576

-

-

-

(2,576)

63,115

-

63,115

Share-based payments

Dividends



-

-
 

-

-
 

858

 (50,649)


858

(50,649)


At 31 December 2008

87,552 

15,149
 

179,776 

282,
477
 

At 1 January 2007
 as previously stated
Impact of adoption of
 IFRIC 11

84,976 
-

25,323 
(575)

184,062 
189

294,361 
(386)

At 1 January 2007 as restated

84,976

24,748

184,25
1

293,975
Release of net gains on
 available-for
  sale assets transferred to the income
  statement on disposal

-

(1,808)

(491)

(2,299)
Net fair value adjustments
 
on financial   investments

-

(6,940)

-

(6,940)

Net surplus on revaluation of
 
freehold   and long
leasehold properties

-

8,614

-

8,614
Income and expenses
 
recognised directly   in equity

-

(134)

(491)

(625)
Profit for the year
 - 
- 
76,315 
76,315 
Share-based payments
- 
- 
304 
304 
Dividends
- 
- 
(93,677)
(93,677)
At 31 December 2007
 
as restated
84,976 
24,614 
166,702 
276,292 








 
 

Statements of changes in equity for the year 1 January 2008 to 31 December 2008




Called up
share capital
Revaluation and other
 
r
eserves
 

Retained earnings

Total
 equity

Bank

€000 

€000 

€000 

€000 

At 1 January 2008

84,976 

24,764 

122,317 

232,057 
Release of net gains on
 available-for-sale assets transferred to the income statement on disposal
   
 -
   
(836) 

-

 (836)
Net fair value adjustments on financial   investments

-

(6,288) 

-

(6,288)
Release of revaluat
ion reserve on disposal of
  properties

-

(2,326)

2,326

-
Income and expenses recognised directly in  equity

-

(9,450)

2,326

(7,124)

Increase in paid-up value

Profit for the year

2,576

-

-

-

(2,576)

49,
383

-

49,383

Share-based payments

Dividends

-

- 

-

- 

805

 (50,649)

805

(50,649)

At 31 December 2008

87,552 

15,314 

121,606 

224,472 

At 1 January 2007 as previously stated
Impact of adoption of IFRIC 11

84,976 
-

25,288 
(540)

145,083
179

255,347
(361)

At 1 January 2007 as restated

84,976

24,748

145,262

254,986
Release of net gains on available-for-sale assets transferred to the income statement on disposal

-

(1,808)

(491)

(2,299)
Net fair value adjustments on financial investments

-

(6,790)

-

(6,790)

Net surplus on revaluation of freehold and long
leasehold properties

-

8,614

-

8,614
Income and expenses
 
recognised directly in   equity

-

16

(491)

(475)
Profit for the year
 - 
- 
70,912 
70,912 
Share-based payments
- 
- 
311 
311 

Dividends

-
 
-
(93,677)
(93,677)
At 31 December 2007
 as restated
84,976 
24,764
122,317 
232,057 








 
 

Cash flow statements 
for the
 year
 1 January 2008 to 3
1
 
December
 2008








Group

Bank

2008
 

2007
 

2008
 

2007
 

€000 

€000 

€000 

€000 








Cash flows 
from
 operating activities







Interest
, commission and premium receipts
314,862
 

337,419 

248,029
 

256,212 
Interest
, commission and claims payments
(145,954)

(122,534)

(125,827)

(105,199)
Payments to employees and suppliers
(79,468)

(76,438)

(75,013)

(72,602)
Operating profit before changes in operating assets/liabilities

89,440
 


138,447 


47
,
189
 


78,411 
(Increase)/decrease in operating assets:







Trading instruments
(32,825)

(15,549)

33
 

(1,349)
Reserve deposit with Central Bank of 
Malta
61,306
 

(815)

61,306
 

(815)
Loans and advances to customers and banks
(471,985)

(112,672)

(471,985)

(112,672)
Treasury 
B
ills 
80,531
 

(54,896)

80,531
 

(54,896)
Other receivables
(4,867)

18,388
 

(4,876)

18,730
 
Increase/(decrease) in operating liabilities:







Customer accounts and amounts owed   to banks

2,379
 


405,122 


(8,316)


444,805 
Other payables
5,213
 

(1,202)

3,801
 

(1,165)
Net cash (used in)/from operating activities before tax 

(270,808)


376,823
 


(292,317)


371,049
 
Tax paid
(38,876)

(33,818)

(30,498)

(33,355)
Net cash (used in)/from operating activities
(309,684)

343,005
 

(322,815)

337,694
 
Cash flows from investing activities







Dividends received
49
 

228 

982
 

7,566 
Interest received from financial investments
23,884
 

21,011 

23,825
 

21,011 
Proceeds from sale and maturity of financial investments

88,551


195,078 


86,156
 


195,078 
Proceeds on sale of property and equipment and intangible assets 

9,755
 


61 


9,750
 


61 
   Purchase of financial investments 
(83,733)

(278,768)

(67,953)

(274,104)
Purchase of property an
d equipment
, investment property
 
and intangible assets

(7,556)


(9,981)


(7,454)


(9,723)
Purchase of shares in subsi
diary companies
-
 

-
 

(6,166)

(6,988)
Net cash 
from/(used in)
 investing activities
30,950
 

(72,371)

39,140
 

(67,099)
Cash flows from financing activities







Dividends paid
(50,649)

(93,677)

(50,649)

(93,677)
Issue of subordinated loan stock 
30,000
 

58,234
 

30,000
 

58,234
 
Subordinated loan stock issue costs
(226)

(302)

  (226)

(302)
Net cash used in financing activities 
(20,875)

(35,745)

  (20,875)

(35,745)
(Decrease)
/increase
 in cash and 
  cash equivalents
 

(299,609)


234,889
 


(304,550)


234,850
 
Effect of exchange rate changes 
  on cash and cash equivalents 

(22,840)


(27,258)


(22,840)


(27,258)
Net (decrease)/increase in cash and 
  cash equivalents 

(276,769)


262,147
 


(281,710)


262,108
 

(299,609)

234,889
 

(304,550)

234,850
 
Cash and cash equivalents at beginning of
year

604,204
 


369,315 


604,122
 


369,27
2
 
Cash 
and cash equivalents at end of
  
year

304,595
 


604,204 


299,572
 


604,12
2
 












Basis of 
p
reparation

The preliminary profit statement is published pursuant to Listing Rule 9.35 of the MFSA Listing Authority and Article 4 (2) (b) of the Prevention of Financial Markets Abuse (Disclosure and Notification) Regulations, 2005. Figures have been extracted from HSBC Bank 
Malta
 p.l.c.
'
s Annual Report and Accounts which have been audited by KPMG
.

These financial statements have been prepared and presented in accordance with International Accounting Standards as adopted by the EU (EU endorsed International Financial Reporting Standards) by virtue of Legal Notice 19 of 2009 of the Accountancy Profession Act : Accountancy Profession (Accounting and Auditing Standards) Regulations 2009.

HSBC Bank Malta p.l.c. is a member of the HSBC Group, whose ultimate parent company is HSBC 
Holdings plc. Headquartered in London, HSBC Holdings plc is one of the largest banking and financial services organisations in the world. The HSBC Group
'
s international network comprises around 
9,500
 properties in 8
5
 countries and territories in Europe, the Asia-Pacific region, the 
Americas
, the Middle East and 
Africa
.
 
 

END

 

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: February 20, 2009