HSBC France € 20,000,000,000 Euro Medium Term Note Programme

39
INSURANCE AND RISK COVERAGE
HSBC France and its subsidiaries are covered by the main world insurance programmes taken out by HSBC
Holdings plc in London regarding the coverage of the major risks (fraud, professional liability, directors’ and
officers’ liability).
As regards the specific insurance requirements of its operations and to comply with French regulations, HSBC
France arranges local insurance programmes centrally, via its Insurance Department, on behalf of the HSBC
France group.
In particular, insurance is used to cover civil liability relating to regulated activities, public liability, banking
risks and the fleet cars.
Damage to real-estate and other property, including IT hardware, and the associated operating losses are insured
by a policy taken out in France. This local policy is linked to the global programme taken out by HSBC
Holdings plc. Replacement value guarantees vary in accordance with types of buildings and activities.
Sums insured, retentions and excesses are:
- in line with market conditions, business area, practice and legislation;
- based on the value of the assets and the potential impact on the balance sheets of HSBC France and
HSBC Holdings plc.
The total amount of insurance premiums paid for 2007 represented 0.28 per cent of net operating income.
Broker, insurance and expert partners are selected in accordance with a strict selection and solvency supervision
policy, established and controlled by HSBC Insurance Holdings plc.
There were no major claims in 2007 concerning the HSBC France group.
2. RISK FACTORS RELATING TO THE NOTES
The following paragraphs describe the principal risk factors that the Issuer believes are material to the Notes to
be offered and/or listed and admitted to trading in order to assess the market risk associated with these Notes.
Prospective investors should consult their own financial and legal advisers about risks associated with
investments in a particular Series of Notes and the suitability of investing in the Notes in light of their particular
circumstances. The risk factors may be supplemented in the Final Terms of the relevant Notes for a particular
issue of Notes.
2.1 The Notes may not be a suitable investment for all investors
Each potential investor in the Notes must determine the suitability of that investment in light of its own
circumstances. In particular, each potential investor should:
(i)
(ii)
(iii)
(iv)
have sufficient knowledge and experience to make a meaningful evaluation of the Notes, the merits and
risks of investing in the relevant Notes and the information contained or incorporated by reference in
this Base Prospectus or any applicable supplement;
have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its particular
financial situation, an investment in the relevant Notes and the impact the relevant Notes will have on
its overall investment portfolio;
have sufficient financial resources and liquidity to bear all of the risks of an investment in the Notes,
including Notes with principal or interest payable in one or more currencies, or where the currency for
principal or interest payments is different from the potential investor's currency;
understand thoroughly the terms of the relevant Notes and be familiar with the behaviour of any
relevant indices and financial markets; and