• Net income attributable to common shares was C$497 million for the year ended 31 December 2006, an increase of 8.8 per cent over the year ended 31 December 2005.
• Net income attributable to common shares was C$128 million for the quarter ended 31 December 2006, a decrease of 3 per cent over the same period in 2005.
• Return on average common equity was 21.1 per cent for the year ended 31 December 2006 and 20.6 per cent for the quarter ended 31 December 2006 compared with 21.3 per cent and 23.8 per cent, respectively, for the same periods in 2005.
• The cost efficiency ratio was 51.3 per cent for the year ended 31 December 2006 and 51.4 per cent for the quarter ended 31 December 2006 compared with 52.2 per cent and 50.0 per cent, respectively, for the same periods in 2005.
• Total assets were C$56.8 billion at 31 December 2006, an increase of C$7.6 billion, or 15.4 per cent, from C$49.2 billion at 31 December 2005.
• Total funds under management were C$31.9 billion at 31 December 2006, an increase of C$3.9 billion, or 13.9 per cent, from C$28.0 billion at 31 December 2005.

Results are prepared in accordance with Canadian generally accepted accounting principles.

Overview

HSBC Bank Canada recorded net income attributable to common shares of C$497 million for the year ended 31 December 2006, an increase of C$40 million, or 8.8 per cent, from C$457 million for 2005. Net income attributable to common shares for the quarter ended 31 December 2006 was C$128 million, a decrease of C$4 million, or 3 per cent, compared with C$132 million for the same period in 2005. The fourth quarter of 2005 included a recovery of C$14 million in our general allowance for credit losses and a one time reduction of C$14 million in deposit guarantee fees following a transfer pricing settlement with the Canada Revenue Agency. Excluding the impact of these items and the related income tax effects, net income attributable to common shares for the fourth quarter of 2006 was 19.6 per cent higher than the same quarter in 2005.

Commenting on the results, Lindsay Gordon, President and Chief Executive Officer, said: "Results for the fourth quarter and for the year were good, reflecting strong growth in our commercial banking business and good momentum in our wealth management businesses. Net interest income was higher from strong loan growth, despite a competitive pricing environment. Non-interest revenues were higher on increased investment administration fees, higher credit fees and higher investment gains. Total non-interest expenses for the year increased as we continued to invest in our businesses, while our efficiency ratio also improved.

"Our focus for 2007 will be to continue this momentum and build for sustained growth by continuing to reinvest in key businesses and leveraging the Group's global distribution network and systems platforms. Business transformation initiatives will be undertaken to further improve efficiency, while continuing to deliver excellent service to our customers. We will also continue our marketing efforts to build on the significant progress made on the awareness of the HSBC brand within Canada."