The biggest bank in Europe by market value showed Wall Street’s titans how it’s truly done, proving that largesse need not lead to large messes in the wake of the subprime debacle. May we present to you the bank’s stellar 2H earnings.

HSBC Holdings Plc, Europe's biggest bank by market value, said second-half profit rose 17 percent as emerging-markets lending overcame subprime losses on customers in the U.S.

Net income increased to $8.24 billion, or 69 cents a share, from $7.1 billion, or 62 cents, a year earlier, beating analysts' estimates, the London-based company said today in a statement. HSBC wrote down $2.1 billion of asset-backed securities, leveraged loans and holdings guaranteed by bond insurers in 2007 and raised its dividend by 11 percent to 90 cents.

HSBC boosted earnings in fast-growing markets including Hong Kong, China and India and reduced its dependence on the U.S. Chairman Stephen Green named Brendan McDonagh last month to head the U.S. unit after scaling back riskier loans and closing units to control bad debts, which spread to credit cards and unsecured loans. Bad loans rose to $17.2 billion in 2007, more than the $10.6 billion in 2006, the company said.

``They look to be a good set of numbers,'' said Simon Maughan, a London-based analyst at MF Global Securities Ltd. with a ``buy'' rating on the stock. ``The U.S. is worse than expected, and everywhere else is pretty much better than expected.''

HSBC rose 1.4 percent to 776.5 pence in London trading at 8:35 a.m. after exceeding the $7.88 billion median profit estimate of 13 analysts surveyed by Bloomberg. The bank is down 7.9 percent this year, valuing it at 92 billion pounds ($182 billion). The FTSE All-Share Bank Index has fallen 9.8 percent.

Asset Writedowns

The bank added Asia head Sandy Flockhart and investment banking chief Stuart Gulliver as executive directors on its board from May 1, according to a separate statement.

Pretax profit rose 5 percent to $10.1 billion. The company reported a $2.34 billion loss in North America, down from a profit of $927 million. Earnings from Hong Kong, the fastest-growing unit, rose 59 percent to $4 billion.

Profit before tax surged 43 percent to $2.67 billion for the rest of Asia Pacific, 35 percent to $4.5 billion in Europe, and from 35 percent to $1.18 billion in Latin America. The earnings included one-time gains of $2.5 billion.

``The economic slowdown and the credit outlook in the U.S. may well get worse before they get better,'' Green said in today's statement. ``With significant parts of the international financial system in developed markets still in difficulties, HSBC's emphasis on faster-growing emerging markets means that we are better positioned than many of our competitors.''

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