The following table summarizes the results for each segment on a Group Reporting Basis, as well as provides a reconciliation of total results under the Group Reporting Basis to U.S. GAAP consolidated totals:



	Group Reporting Basis Consolidated Amounts
	RBWM			CMB			GB&M			PB			CC			Adjustments/ Reconciling Items		Total			Group Reporting Basis Adjustments⁽⁵⁾			Group Reporting Basis Reclassi- fications⁽⁶⁾			U.S. GAAP Consolidated Totals
	(in millions)
Three Months Ended June 30, 2018
Net interest income⁽¹⁾	$	225		$	195		$	151		$	43		$	18		$	—	$	632		$	6		$	(83	)	$	555
Other operating income	71			58			252			16			72			—		469			(9		)	77			537
Total operating income	296			253			403			59			90			—		1,101			(3		)	(6		)	1,092
Expected credit losses / provision for credit losses	3			(36		)	(143		)	—			1			—		(175		)	118			12			(45		)
	293			289			546			59			89			—		1,276			(121		)	(18		)	1,137
Operating expenses⁽²⁾	341			139			209			61			54			—		804			—			(18		)	786
Profit (loss) before income tax expense	$	(48	)	$	150		$	337		$	(2	)	$	35		$	—	$	472		$	(121	)	$	—		$	351

Three Months Ended June 30, 2017
Net interest income⁽¹⁾	$	221		$	181		$	156		$	56		$	(7	)	$	—	$	607		$	(16	)	$	(9	)	$	582
Other operating income⁽³⁾	238			52			169			21			78			—		558			(11		)	11			558
Total operating income	459			233			325			77			71			—		1,165			(27		)	2			1,140
Loan impairment charges / provision for credit losses	(3		)	(5		)	(2		)	1			—			—		(9		)	(21		)	9			(21		)
	462			238			327			76			71			—		1,174			(6		)	(7		)	1,161
Operating expenses⁽²⁾⁽³⁾	287			141			248			63			125			—		864			(8		)	(7		)	849
Profit (loss) before income tax expense	$	175		$	97		$	79		$	13		$	(54	)	$	—	$	310		$	2		$	—		$	312

Six Months Ended June 30, 2018
Net interest income⁽¹⁾	$	441		$	381		$	300		$	90		$	33		$	—	$	1,245		$	14		$	(152	)	$	1,107
Other operating income	164			113			449			36			155			—		917			(20		)	153			1,050
Total operating income	605			494			749			126			188			—		2,162			(6		)	1			2,157
Expected credit losses / provision for credit losses	6			(46		)	(157		)	(3		)	4			—		(196		)	67			13			(116		)
	599			540			906			129			184			—		2,358			(73		)	(12		)	2,273
Operating expenses⁽²⁾	666			290			425			122			586			—		2,089			(9		)	(12		)	2,068
Profit (loss) before income tax expense	$	(67	)	$	250		$	481		$	7		$	(402	)	$	—	$	269		$	(64	)	$	—		$	205
Balances at end of period:
Total assets	$	18,691		$	23,851		$	79,535		$	7,075		$	85,703		$	—	$	214,855		$	(34,168	)	$	—		$	180,687
Total loans, net⁽⁴⁾	16,695			22,879			17,786			6,036			1,865			—		65,261			(1,341		)	1,948			65,868
Goodwill	581			358			—			321			—			—		1,260			347			—			1,607
Total deposits⁽⁴⁾	32,672			23,643			32,749			8,112			4,553			—		101,729			(3,168		)	15,794			114,355



	Group Reporting Basis Consolidated Amounts
	RBWM		CMB			GB&M			PB		CC			Adjustments/ Reconciling Items		Total			Group Reporting Basis Adjustments⁽⁵⁾			Group Reporting Basis Reclassi- fications⁽⁶⁾			U.S. GAAP Consolidated Totals
	(in millions)
Six Months Ended June 30, 2017
Net interest income⁽¹⁾	$	434	$	361		$	308		$	109	$	1		$	—	$	1,213		$	(29	)	$	(5	)	$	1,179
Other operating income⁽³⁾	386		104			311			42		172			—		1,015			129			7			1,151
Total operating income	820		465			619			151		173			—		2,228			100			2			2,330
Loan impairment charges / provision for credit losses	6		(41		)	(37		)	3		(1		)	—		(70		)	(48		)	20			(98		)
	814		506			656			148		174			—		2,298			148			(18		)	2,428
Operating expenses⁽²⁾⁽³⁾	573		280			472			124		235			—		1,684			2			(18		)	1,668
Profit (loss) before income tax expense	$	241	$	226		$	184		$	24	$	(61	)	$	—	$	614		$	146		$	—		$	760
Balances at end of period:
Total assets	$	18,960	$	23,515		$	80,426		$	8,131	$	97,950		$	—	$	228,982		$	(35,632	)	$	—		$	193,350
Total loans, net	16,709		22,335			19,805			6,354		3,292			—		68,495			(1,035		)	(245		)	67,215
Goodwill	581		358			—			325		—			—		1,264			348			—			1,612
Total deposits	34,868		20,799			20,920			10,262		7,572			—		94,421			(3,849		)	26,571			117,143

⁽¹⁾

Net interest income of each segment represents the difference between actual interest earned on assets and interest incurred on liabilities of the segment adjusted for a funding charge or credit. Segments are charged a cost to fund assets (e.g. customer loans) and receive a funding credit for funds provided (e.g. customer deposits) based on equivalent market rates. The objective of these charges/credits is to transfer interest rate risk from the segments to one centralized unit in Balance Sheet Management and more appropriately reflect the profitability of the segments.


⁽²⁾	Expenses for the segments include fully apportioned corporate overhead expenses.

⁽³⁾

During the fourth quarter of 2017, we changed our presentation for certain cost reimbursements that were previously netted as an offset to affiliate expense and began presenting these reimbursements gross in affiliate income. As a result, we have reclassified prior period amounts in order to conform to the current year presentation, which increased both RBWM other operating income and RBWM operating expenses $13 million and $24 million and also increased both GB&M other operating income and GB&M operating expenses $16 million and $37 million during the three and six months ended June 30, 2017, respectively. See Note 14, "Related Party Transactions," for additional information.

⁽⁴⁾

In addition to the changes discussed above, in conjunction with HSBC's adoption of the requirements of IFRS 9 we also adopted changes in presentation under the Group Reporting Basis related to affiliate loans and deposits as well as cash collateral posted and received. Beginning January 1, 2018, affiliate loans have been reclassified from other assets to loans, affiliate deposits have been reclassified from other liabilities to deposits, cash collateral posted has been reclassified from loans to other assets and cash collateral received has been reclassified from deposits to other liabilities. As a result of these changes, total loans, net and total deposits in the GB&M segment increased $0.1 billion and $8.4 billion, respectively, and total loans, net and total deposits in the CC segment decreased $2.3 billion and $1.1 billion, respectively, at June 30, 2018.


⁽⁵⁾	Represents adjustments associated with differences between U.S. GAAP and the Group Reporting Basis.


⁽⁶⁾	Represents differences in financial statement presentation between U.S. GAAP and the Group Reporting Basis.