HSBC reveals some hefty salaries as well as 21% jump in profits

An unnamed employee of HSBC who is not even a director of the giant bank received £7.4m in pay last year, four-times as much as the remuneration for its veteran executive chairman, Sir John Bond.

The mega salary, which was paid to a trader based in the US, emerged as HSBC posted a 21 per cent increase in pre-tax profits to $9.65bn (£6.43bn) in the year to 31 December. Four more employees below board level also received bumper payouts of more than £4.1m each.

HSBC had to disclose the sums because Hong Kong stock exchange rules stipulate that companies listed there must make public not only their directors' remuneration but also the five highest-paid employees below board level.

Sir John, who has worked for HSBC for 42 years, declared he was not jealous of the payouts. "They have taken more risks in their jobs than I have in mine," Sir John remarked. Traders who work in areas such as foreign exchange and credit derivatives are paid almost entirely on the basis of how much profit they generate in one year and are often sacked if they fail to perform well.

Sir John himself received a 3.5 per cent increase in pay last year to £1.885m while Sir Keith Whitson, HSBC's outgoing chief executive, took a 43 per cent pay rise to £2.2m. Sir Keith's rise reflected the fact he will miss out on a long-term bonus scheme. Sir Keith will be replaced by Stephen Green, who has been responsible for the investment bank.

HSBC broke ranks with the other banks by announcing plans to start paying dividends on a quarterly basis beginning in the second quarter of the year. At the moment only a handful of British businesses pay dividends on a quarterly basis, including BP and GlaxoSmithKline. But, coming at a time when investors are focusing more on dividends than companies' capital growth, the decision by HSBC may persuade more British companies to move to quarterly payouts.

HSBC, based in Britain and with operations around the globe, said that while prospects for 2003 were uncertain amid fears of a war in Iraq and tumbling stock markets, it expected modest global economic growth.

HSBC raised its dividend by 10 per cent to 53 cents. Its shares rose 5p to 689p.

The bank followed an increasing number of FTSE 100 companies to reveal it injected extra cash into its final-salary pension fund due to falling stock markets, putting in £500m earlier this year.