STRIKE IT RICH.
The figures were boosted by falling costs, fewer bad debts and stronger than expected dealing profits.
The Far East, and in particular Hong Kong, remains a core area of operation even though Europe now provides over one third of its profits since its takeover of Midland Bank.
The challenge for HSBC during the Asian crisis was whether it could maintain operating profits whilst managing the inevitable bad-debt cycle.
In fact, despite half of HSBC's world still being in recession, it was able to achieve a yearly return of more than 18 per cent in the first half of this year.
It not only weathered the Asian downturn but has strengthened its position there as weaker competitors have withdrawn from the region. And growth continued in both Hong Kong and Asia Pacific. Looking to the future, HSBC is expected to reap the benefits as South-East Asia recovers.
Stabilisation of debt problems in Hong Kong and an expected improvement in the rest of the Asia Pacific region have led to a lower bad-debt forecast and raising of profit forecasts.
HSBC shares look set to give holders an enjoyable ride.