HSBC Mexico Subsid Results

HSBC Holdings PLC
26 February 2003

                             GRUPO FINANCIERO BITAL

                        2002 ANNUAL RESULTS - HIGHLIGHTS

* HSBC Holdings plc (HSBC) completed the acquisition of Grupo Financiero Bital
(GFBital) on 25 November 2002.

* The price paid for shares tendered to HSBC was US$1,135 million.

* Prior to year-end, HSBC subscribed for additional capital totalling US$800
million, which resulted in ownership of 99.8 per cent of GFBital at 31 December
2002.

* This additional capital was used to strengthen GFBital's balance sheet and
bolster reserves in line with local and international standards. GFBital
reported a full year net loss of MXP6,575 million for 2002.^

* The total capital ratio at year-end 2002 was 10.96 per cent for Banco
Internacional, the principal subsidiary of GFBital.


^ Within the HSBC Holdings plc 2002 consolidated financial results, which will
be published on 3 March 2003, GFBital will provide a small positive contribution
to earnings, reflecting December results post-acquisition. The losses referred
to above arose pre-acquisition and therefore were reflected in the opening
balance sheet acquired by HSBC.




Comment from the Chief Executive Officer:

Sandy Flockhart, GFBital's Chief Executive Officer, said: "I am pleased with the
pace of integration to date. We have already made progress in implementing
within GFBital some of the HSBC Group standards in risk management, internal
control, and expense discipline which will benefit this institution in 2003. Our
challenge is to instill these standards while maintaining the sales culture and
positive business momentum which has been the trademark of GFBital.

"GFBital's full year 2002 results include the financial strengthening exercise
undertaken by HSBC upon acquisition, which was funded by a US$800 million
capital injection. These results are entirely consistent with HSBC's
expectations from our due diligence process in July through completion of the
tender offer process in November. As a consequence of the recapitalisation,
Banco Internacional, the principal subsidiary of GFBital, reported a capital
adequacy ratio of 10.96 per cent at year-end 2002, which exceeded the 10.00 per
cent target established by the Mexican regulators.

"Many of the underlying financial trends within GFBital are promising. Core
customer deposits increased 15 per cent and local market share rose by 1 per
cent from a year ago. Fees and commissions rose 16 per cent in 2002 compared
with the year ended 31 December 2001 due to higher transaction volumes and new
customers. The profitability of our insurance joint venture increased 68 per
cent. HSBC's broad product expertise and global customer base complements
GFBital's existing business platform. These synergies will provide competitive
advantages for GFBital and a solid foundation for future growth."

Financial Notes:

GFBital recorded a net loss of MXP6,575 million for the year ended 31 December
2002. The loss principally reflected provisions as required by the CNBV
(Comision Nacional Bancaria) to reflect GFBital's share of loss-sharing in
Fobaproa (Fondo Bancario de Proteccion al Ahorro) programmes, to bring
commercial loan loss reserves in line with CNBV requirements and to revalue or
write off assets to their recoverable value. An injection of US$800 million
capital was made by HSBC to recapitalise the bank.

Prior to the HSBC acquisition, GFBital acquired all of the assets and
liabilities of Banco del Atlantico effective 1 October 2002, consistent with
agreements in place with the Mexican regulatory authorities. The composition of
GFBital's balance sheet changed considerably as a result of this transaction.
The most notable impact was the increase in loans to Fobaproa and IPAB
(Instituto de Proteccion al Ahorro Bancario) to MXP57,595 million.

GFBital is one of the five major banking and financial services institutions in
Mexico, with some 1,400 branches, 4,000 ATMs, and 17,500 employees. GFBital is
well positioned to complement HSBC's Asian, European and North American
operations.

GFBital is a directly held, majority-owned subsidiary of HSBC Holdings plc.
Headquartered in London, with over 8,000 offices in 80 countries and territories
and assets of US$746 billion at 30 June 2002, the HSBC Group is one of the
world's leading banking and financial services organisations.

Consolidated balance sheet
                                                              At                     At                   At
Figures in constant MXP millions                         31Dec02               30Sept02 ^            31Dec01 ^
Assets
Funds available                                           32,673                 85,743               52,735
Investments in securities                                  8,573                  4,749               16,557
Receivable under Repo agreements                              12                      7                   50

Loans to IPAB/Fobaproa                                    57,595                 19,009               20,078
Other accruing loans                                      49,725                 43,509               43,141
Non-performing loans                                      13,556                  5,269                4,774
Total loan portfolio                                     120,876                 67,787               67,993
Minus: Reserve for loan loss                             (15,697)                (7,735)              (5,672)
Net loan portfolio                                       105,179                 60,052               62,321

Foreclosed assets                                            700                    707                  733
Property, furniture and equipment                          3,328                  3,555                3,852
Permanent equity investments                               1,086                    819                  744
Deferred taxes                                             4,063                  3,875                2,576
Other assets                                               5,154                  4,533                4,225
Total assets                                             160,768                164,040              143,793

Liabilities
Demand deposits                                           80,007                 68,354               72,638
Time deposits                                             50,751                 64,354               45,757
Total deposits                                           130,758                132,708              118,395
Loans from banks and other institutions                   10,711                 16,689               10,493
Payable under Repo agreements                                 64                    268                  136
Subordinated debentures                                    2,175                  1,537                1,595
Other liabilities                                          7,226                  4,386                4,271
Total liabilities                                        150,934                155,588              134,890
Capital
Paid-in capital                                           19,804                 11,652               10,484
Earned capital                                           (10,010)                (3,271)              (1,677)
Minority interest                                             40                     71                   96
Total shareholders' equity                                 9,834                  8,452                8,903
Total liabilities & capital                              160,768                164,040              143,793


^ Figures appear in constant pesos at 31 December 2002, which means prior
period figures are adjusted to account for the inflationary impact in order to
enhance comparability.



Consolidated income statement
                                                       Quarter ended        Quarter ended        Quarter ended
Figures in constant MXP millions                             31Dec02             30Sept02 ^            31Dec01 ^

Interest income                                                5,014                4,602                4,594
Interest expense                                               2,479                2,581                2,654
Monetary position (net interest income)                           67                   18                   23
Net interest income                                            2,602                2,039                1,963
Provision for loan loss                                        4,782                  611                  637
Adjusted net interest income                                  (2,180)               1,428                1,326
Fees and Commissions                                           1,086                1,126                  899
Trading income                                                   234                  206                  328
Total net revenues                                              (860)               2,760                2,553
Operating expenses                                             4,715                2,409                2,418
Operating income                                              (5,575)                 351                  135
Other income (expenses)                                       (1,751)                 (57)                  96
Net income before taxes                                       (7,326)                 294                  231
Income tax and profit sharing                                     74                  (17)                (115)
Deferred income tax                                              326                 (174)                 (60)
Net income before subsidiaries                                (6,926)                 103                   56
Undistributed net income from subsidiaries                        29                   54                   28
Net income from continuing operations                         (6,897)                 157                   84
Extraordinary & non-recurrent                                      1                  (34)                   -
Minority interest                                                 64                   (1)                  (1)
Net income (loss)                                             (6,832)                 122                   83



Breakdown of net income by subsidiary
                                                       Quarter ended        Quarter ended        Quarter ended
Figures in constant MXP millions                             31Dec02             30Sept02 ^            31Dec01 ^
                                            Ownership %

Banco Internacional (Bank)                        99.55       (6,840)                  70                   62
Seguros Bital (Insurance)                         51.00           29                   32                   20
Fianzas Mexico Bital (Bonding)                    97.22          (10)                  20                    7
Casa de Bolsa Bital (Stock Broker)                99.99           (8)                   -                   (6)
Almacenadora Bital (Warehousing)                  99.98            -                    1                   (1)
Operadora de Fondos (Inv. Fund Mngr)              99.90            -                    -                    -
GFBital (Holding Co.)                            100.00           (3)                  (1)                   1
Total net income (loss)                                       (6,832)                 122                   83


^ Figures appear in constant pesos at 31 December 2002, which means prior
period figures are adjusted to account for the inflationary impact in order to
enhance comparability.




Consolidated income statement
                                                                         Year ended            Year ended
Figures in constant MXP millions                                            31Dec02               31Dec01 ^

Interest income                                                              18,320                23,818
Interest expense                                                              9,795                14,933
Monetary position (net interest income)                                         122                    97
Net interest income                                                           8,647                 8,982
Provision for loan loss                                                       6,256                 3,391
Adjusted net interest income                                                  2,391                 5,591
Fees and Commissions                                                          4,086                 3,526
Trading income                                                                  839                 1,747
Total net revenues                                                            7,316                10,864
Operating expenses                                                           12,087                 9,733
Operating income                                                             (4,771)                1,131
Other income (expenses)                                                      (1,969)                 (378)
Net income before taxes                                                      (6,740)                  753
Income tax and profit sharing                                                   (22)                 (218)
Deferred income tax                                                              81                  (140)
Net income before subsidiaries                                               (6,681)                  395
Undistributed net income from subsidiaries                                      158                   108
Net income from continuing operations                                        (6,523)                  503
Extraordinary & non-recurrent                                                  (114)                    -
Minority interest                                                                62                    (7)
Net income (loss)                                                            (6,575)                  496



Breakdown of net income by subsidiary
                                                                       Year ended             Year ended
Figures in constant MXP millions                       Ownership          31Dec02                31Dec01 ^
                                                               %

Banco Internacional (Bank)                                 99.55           (6,639)                   395
Seguros Bital (Insurance)                                  51.00              103                     61
Fianzas Mexico Bital (Bonding)                             97.22               24                     30
Casa de Bolsa Bital (Stock Broker)                         99.99              (10)                     2
Almacenadora Bital (Warehousing)                           99.98                3                      1
Operadora de Fondos (Inv. Fund Mngr.)                      99.90                0                     (0)
GFBital (Holding Co.)                                     100.00              (56)                     7
Total net income (loss)                                                    (6,575)                   496


^ Figures appear in constant pesos at 31 December 2002, which means prior
period figures are adjusted to account for the inflationary impact in order to
enhance comparability.


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