Financial Markets and Bank Management Essay Example | Topics and Well Written Essays - 1000 words

Financial Markets and Bank Management - Essay ExampleThe paper attempts to look for how HSBC Bank has performed on these parameters in year 2012 and 2013. The paper will also make specific recommendations for improving banks performance in the historic period ahead.HSBCs balance sheets for year 2012 and 2013 report its income from six sources Net interest income, Net fee income, trading income, Net income from financial instruments at fair value, net get insurance premiums, and other operating(a) income. Of these, interest income is the largest component followed by income from fee. On comparing HSBCs performance in year 2013 with its previous year (2012), it can be seen that its interest income has gone up by (6,961-6,519)/6,519 = 6.7%. While there is a marginal rise in fee income from 3,309 million to 3,336 million, there is a meaning(a) rise in its trading income from 1,587m to 2,373m. In percentage terms, this amounts to nearly 50%. Income from financial instruments has incre ased by almost 660% from 118m to 900m however, the banks earned insurance premium income has declined by around 10% from 2,286m to 2022m (HSBC Bank, 2013 p.10).While Banks net operating income has increased by almost 17% from 10,133m to 11,869m in year 2012 and 2013 respectively, the most noteworthy aspect is that its operating expense has reduced significantly from 9,506m to 8,575m. In percentage terms, expense reduction is almost 10% (HSBC Bank, 2013 p. 10). This had indeed a very positive impact on banks financial performance in 2013. With HSBC bank, deposits have increased from 39,571m in 2012 to 50,683m in 2013. Even loans and advances have increased from 32,286 to 53,228 an increase of over 60% (HSBC Bank Plc., 2013 p.95). This reveals a full confidence of the customers on HSBC bank.Pre-tax profit is derived after making loan-loss provisions, and operating income is the